AM Best has revised the outlook to positive from stable for the Long-Term Issuer Credit Rating (Long-Term ICR) and affirmed the Financial Strength Rating (FSR) of B++ (Good) and the Long-Term ICR of “bbb” (Good) of Standard Casualty Company, based in New Braunfels, Texas. The outlook of the FSR is stable.
The Credit Ratings (ratings) reflect Standard Casualty’s balance sheet strength, which AM Best assesses as strong, as well as its marginal operating performance, limited business profile and appropriate enterprise risk management (ERM). Additionally, the ratings recognize the synergistic advantages and financial support derived from the company’s relationship with its ultimate parent, Cavco Industries, Inc. (Cavco) [NASDAQ; CVCO].
The Long-Term ICR revised outlook to positive from stable reflects Standard Casualty’s improvement in risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR), which is now assessed as strongest, from previously being aligned with very strong. The more robust position reflects significant surplus growth in 2025 (43%), as well as throughout the beginning of 2026, coupled with derisking initiatives that have reduced overall exposures and driven down the gross probable maximum loss in recent years. Collectively, the actions also assisted improvement in Standard Casualty’s key balance sheet metrics such as underwriting and reserve leverage, as premium and reserves declined while surplus grew. Furthermore, the company benefits from its relationship with Cavco, as the company has additional financial flexibility through the ability to access funds held at affiliated entities.
Standard Casualty’s marginal operating performance is reflective of volatility in its results over the most recent five-year period, before considerably improving in 2025, and through the beginning of 2026. Prior year losses came as a result of changing weather patterns, leading to more frequent and severe events, as well as greater claim severity due to inflation. However, a reduction in overall exposures through the non-renewal of high-risk accounts and application of stricter underwriting guidelines have improved results. The limited business profile assessment is based on the company’s relatively concentrated geographic footprint and property focused portfolio, while the appropriate ERM assessment reflects improving risk appetite strategies that have caused results to trend positively.
Source: AM Best
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