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Selective Insurance and Units' Ratings Retained by A.M. Best

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Selective Insurance Group, Inc.’s (SIGI - Free Report) Long-Term Issuer Credit Ratings (ICR) of “bbb+” is reiterated by A.M. Best. Concurrently, 10 pooled members’ Financial Strength Rating (FSR) of A (Excellent) and Long-Term ICR of “a+” have also been retained by the rating giant. The outlook stays stable.

The rating affirmations came on the back of strong risk-adjusted capitalization and better operating performance of the group since 2012. The ratings also account for the company’s high policy-retention rates across its standard lines of business and its solid market presence.  Based on 2016 net premiums written, Selective Insurance ranks as the 36th largest property and casualty insurer in the United States.

These positives are driven by Selective Insurance’s competent management, systematic procedure of handling claims and sturdy underwriting results.

However, these positives are weighed on by lower net investment yield and unfavorable operating leverage when compared with commercial casualty composite.

Nonetheless, Selective Insurance’s adjusted debt-to-total capital ratio is within A.M. Best’s guidelines and interest coverage ratio is more than what is required for the ratings.

Financial performances of companies are assessed regularly by rating agencies. These ratings play a significant role in retaining investor confidence as well as in maintaining credit worthiness. Thereby, these enhance the competitive position of the company in the market. These ratings reflect the financial stability of the company in the long run.

Zacks Rank and Share Price Movement

Selective Insurance Group carries a Zacks Rank #4 (Sell). Shares of Selective Insurance have outperformed the industry in a year’s time. While Selective Insurance Group’s shares have rallied 20.3%, the industry has gained 19.7%. Sturdy underwriting results and operational performance are expected to drive the stock higher in the future.

 

 

Stocks to Consider

Some better-ranked stocks from the insurance industry are Atlas Financial Holdings, Inc. , Markel Corporation (MKL - Free Report) and Mercury General Corporation (MCY - Free Report) . Each of these stocks sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Atlas Financial Holdings engages in underwriting commercial automobile insurance policies in the United States. The company delivered positive surprises two out of the last four quarters, with an average beat of 57.94%.

Markel Corporation markets and underwrites specialty insurance products in the United States and internationally. The company delivered positive surprises in two out of the last four quarters, with an average beat of 21.06%.

Mercury General Corporation engages in writing personal automobile insurance in the United States. The company delivered positive surprises in three of the last four quarters, with an average beat of 1.06%.

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