OLDWICK, N.J.--(BUSINESS WIRE)--Sep 7, 2018--A.M. Best has revised the outlook to stable from positive for the Long-Term Issuer Credit Rating (Long-Term ICR) and affirmed the Financial Strength Rating (FSR) of A (Excellent) and the Long-Term ICR of “a” of Toyota Motor Insurance Company (TMIC) (Cedar Rapids, IA). The outlook of the FSR remains stable.
The ratings reflect TMIC’s balance sheet strength, which A.M. Best categorizes as strongest, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management.
TMIC continues to maintain robust risk-adjusted capital, with growth driven by underwriting and investment results. Underwriting performance has declined in recent years as a result of its guaranteed auto protection (GAP) business, which management has addressed through rate increases. TMIC plays a strategic role within the Toyota organization by providing vehicle service agreements, guaranteed auto protection agreements, excess wear and use coverage and tire and wheel protection sold through Toyota, Lexus and affiliated dealerships throughout the United States. It is susceptible to general economic conditions and the economy’s impact on automobile purchases, along with vehicle financing standards.
The stable outlooks reflect the expectation for stable-to-improving underwriting performance following TMIC management’s pricing actions taken to address the unfavorable loss development related to its GAP business, which is expected to be realized in the next 12-18 months.
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KEYWORD: UNITED STATES EUROPE NORTH AMERICA NEW JERSEY
INDUSTRY KEYWORD: PROFESSIONAL SERVICES INSURANCE
SOURCE: A.M. Best
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PUB: 09/07/2018 10:53 AM/DISC: 09/07/2018 10:52 AM