AM Best Removes From Under Review With Positive Implications, Affirms Credit Ratings of ClearPath Insurance Company; Assigns Positive Outlook
AM Best has removed from under review with positive implications and affirmed the Financial Strength Rating (FSR) of A- (Excellent) and the Long-Term Issuer Credit Rating (Long-Term ICR) of "a-" (Excellent) of ClearPath Insurance Company (ClearPath) (Bel Air, MD). The outlook assigned to these Credit Ratings (ratings) is positive.
The ratings reflect ClearPath's balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management.
ClearPath's ratings were previously placed under review with positive implications in March 2023, following the announcement that it had entered into a definitive merger agreement with Harford Mutual Insurance Group, Inc. (Harford Mutual). Harford Mutual is the parent company of The Harford Mutual Insurance Company.
On Aug. 15, 2023, it was announced that Harford Mutual received final approval from the Maryland Insurance Administration of the merger agreement with ClearPath, with an effective date of Aug. 4, 2023. As part of the transaction, ClearPath converted to a stock insurance company from a mutual company and became a wholly owned direct subsidiary of Harford Holdings, Inc. and an indirect subsidiary of the mutual holding company.
The positive outlook assigned to the FSR and the Long-Term ICR reflects the plan to add ClearPath as a member of Harford Mutual via a 100% quota share reinsurance agreement on Jan. 1, 2024. The ClearPath brand will continue post-merger and will be the group's monoline workers' compensation unit with eventual expansion into Harford states. In addition, ClearPath headquarters will become the group's Midwest regional office.
This press release relates to Credit Ratings that have been published on AM Best's website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best's Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best's Credit Ratings. For information on the proper use of Best's Credit Ratings, Best's Performance Assessments, Best's Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best's Ratings & Assessments.
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