A.M. Best Withdraws Credit Ratings of North American Title Insurance Company
OLDWICK, N.J.--(BUSINESS WIRE)--Sep 21, 2018--A.M. Best has downgraded the Financial Strength Rating to B (Fair) from B++ (Good) and the Long-Term Issuer Credit Rating to “bb+” from “bbb+” of North American Title Insurance Company (NATIC) (Concord, CA). The outlook of these Credit Ratings (ratings) has been revised to stable from positive. Concurrently, A.M. Best has withdrawn the ratings upon management’s request to no longer participate in A.M. Best interactive rating process.
The downgrade of the ratings takes into consideration the $60 million dividend taken by NATIC in the third quarter of 2018 and its consequential detrimental effect on the company’s risk-adjusted capitalization. As an affiliate of Lennar Corporation, one of the largest homebuilders in the United States, NATIC is afforded rating enhancement in the form of implied support.
The ratings reflect NATIC’s balance sheet strength, which A.M. Best categorizes as weak, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management.
NATIC is one of the largest regional title insurance writers in the United States, with business in 30 states and plans to expand its footprint nationwide. Its business is concentrated in California, Texas and Florida. While the large dividend was driven by management’s decision to not pursue a strategy to write commercial title business; NATIC remains committed to its residential title book, which has consistently been profitable and accretive to surplus.
This press release relates to Credit Ratings that have been published on A.M. 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 A.M. Best’s web page. For additional information regarding the use and limitations of Credit Rating opinions, please view . For information on the proper media use of Best’s Credit Ratings and A.M. Best press releases, please view .
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CONTACT: A.M. Best
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Daniel J. Ryan
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Manager, Public Relations
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Director, Public Relations
+1 908 439 2200, ext. 5644
KEYWORD: UNITED STATES EUROPE NORTH AMERICA NEW JERSEY
INDUSTRY KEYWORD: PROFESSIONAL SERVICES BANKING FINANCE INSURANCE
SOURCE: A.M. Best
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PUB: 09/21/2018 01:37 PM/DISC: 09/21/2018 01:37 PM