|[August 14, 2014]
A.M. Best Revises Outlook of Issuer Credit Rating to Positive for Great Plains Casualty, Inc.
OLDWICK, N.J. --(Business Wire)--
A.M. Best has revised the outlook to positive from stable and
affirmed the issuer credit rating (ICR) of "bbb" for Great Plains
Casualty, Inc. (Great Plains) (Cedar Rapids, IA). A.M. Best has also
affirmed Great Plains' financial strength rating (FSR) of B++. The
outlook for the FSR is stable.
The rating action reflects Great Plains' strong risk-adjusted
capitalization, due to its conservative underwriting and investment
leverage measures, as well as its limited but consistently favorable
operating performance since its inception. The ratings also reflect the
company's in-depth knowledge of the commercial trucking industry and the
favorable financial leverage and interest coverage of its parent holding
company, Hillcrest Holdings, Inc. In addition, the company
benefits from the expertise gained by having common management between
Great Plains and its sister company, CRST International Inc., which
provides transportation solutions and services to manufacturers and
distributors i the United States and Canada.
Offsetting these positive factors is Great Plains' narrow product focus
and inherent risk as a relatively new company attempting to gain market
share and expand its geographic presence.
A.M. Best believes factors that may lead to positive rating actions
include a trend of positive operating and underwriting profitability
that outperforms the composite while maintaining favorable risk-adjusted
capitalization. Factors that could lead to negative rating actions
include a material deviation from management's projections, a lack of
underwriting discipline which results in a trend of deteriorating
underwriting and operating performance to a level below peers, or an
erosion of surplus that causes a significant decline in risk-adjusted
The methodology used in determining these ratings is Best's Credit
Rating Methodology, which provides a comprehensive explanation of A.M.
Best's rating process and contains the different rating criteria
employed in the rating process. Best's Credit Rating Methodology can be
found at www.ambest.com/ratings/methodology.
A.M. Best Company is the world's oldest and most authoritative
insurance rating and information source. For more information, visit www.ambest.com.
Copyright © 2014 by A.M. Best Company, Inc. ALL RIGHTS
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