AM Best affirms credit ratings of The HSB Group’s members
AM Best has affirmed the Financial Strength Rating (FSR) of A++ (Superior) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of “aa+” of the members of The Hartford Steam Boiler Group (HSB). The outlook of these Credit Ratings (ratings) is stable. (See below for a detailed listing of the companies.)
The ratings reflect HSB’s balance sheet strength, which AM Best categorizes as strongest, as well as its very strong operating performance, favorable business profile and very strong enterprise risk management (ERM).
HSB’s balance sheet strength assessment is underpinned by its risk-adjusted capitalization being at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR), as well as its good liquidity, conservative investments allocation and a history of positive reserve development.
HSB has a long track record of very strong underwriting and operating profits. The company’s five-year return of equity (ROE) of 16.5% is materially better than the composite five-year ROE of 4.6%. Likewise, its 10-year ROE of 20.1% also outperforms the composite 10-year ROE of 5.8%. The performance is primarily driven by strong underwriting returns and enhanced by steady stream of investment income. In recent years, the group has seen a slight deterioration in underwriting ratios. This deterioration is mainly due to elevated expenses related to ongoing projects, which are anticipated to improve performance in future years.
The group has a long-standing reputation as a valuable partner to insurance companies throughout the industry. This unique position allows the company to distribute its products throughout the United States, as well as in other markets. Additionally, it allows its partners to access the specialized knowledge and innovative products the group provides to the industry, including Internet of Things (IoT) and other loss control solutions. In recent years, the group has developed innovative solutions to cyber insurance and equipment breakdown policies, including IoT, which have produced favorable returns.
The FSR of A++ (Superior) and the Long-Term ICRs of “aa+” have been affirmed with stable outlooks for the following members of The Hartford Steam Boiler Group:
The Hartford Steam Boiler Inspection and Insurance Company
The Hartford Steam Boiler Inspection and Insurance Company of Connecticut
The Boiler Inspection and Insurance Company of Canada
HSB Specialty Insurance Company
HSB Engineering Insurance Limited
Authored by AM Best
About HSB
HSB, part of Munich Re, is a leading specialist provider of engineering and technology insurance and inspection services.
Backed by over 150 years of innovation and covering a broad range of technologies and industry sectors, we help customers reduce risk through the provision of innovative construction, engineering, energy, and cyber insurance products.
Established in the U.S. in 1866, HSB’s founding principles of technical expertise and loss prevention remain at the forefront of the work we do today. Whether it’s engineering solutions for contractors, comprehensive machinery and technology insurance, innovative energy efficiency policies, or SME cyber risk covers, we have the knowledge to show customers how, working with HSB, they can stay ahead of emerging risks in a complex world.
With over 500 employees, and offices in Belfast, Birmingham, Dublin, Glasgow, London and Manchester, we provide insurance and engineering inspection services that touch almost every aspect of work and life.
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