[January 22, 2013]

A.M. Best Assigns Ratings to Caregivers United Liability Insurance Company, A Risk Retention Group

A.M. Best Co. has assigned a financial strength rating of A- (Excellent) and issuer credit rating of "a-" to Caregivers United Liability Insurance Company, A Risk Retention Group (CULIC) (Charleston, SC). The outlook assigned to both ratings is stable.

The ratings reflect CULIC's excellent risk-adjusted capitalization, profitable underwriting and overall operating results in recent years as well as its niche expertise as a provider of professional and general liability insurance products to nursing homes and assisted living facilities in Mississippi.

CULIC writes only professional and general liability coverages for long-term care facilities in Mississippi. The company's focus on writing profitable risks continues to generate solid underwriting profits and overall operating results. This has enabled CULIC to maintain excellent risk-adjusted capitalization for its current business profile. The company's extensive market knowledge of the extended care business in Mississippi, along with its low cost operating platform, provides it with a competitive advantage and enhances member retention.

Prtially offsetting these positive rating factors is CULIC's limited business profile and its associated jurisdiction and regulatory risks. CULIC is susceptible to the inherent market risks associated with being a single state, mono line insurer, as it relates to legislative (tort) reform, regulatory challenges and loss cost trends.

While the outlook is stable, factors that could contribute to rating enhancement include continued favorable performance on both an underwriting and overall basis and the consistent generation of surplus and maintenance of CULIC's strong capitalization, while prudently managing its business profile risks.

Factors that may lead to negative rating actions include a sustained decline in the company's underwriting performance, a change in the tort environment or legislative/judicial landscape and substantial deterioration in its risk-adjusted capitalization.

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. Key criteria utilized include: "Risk Management and the Rating Process for Insurance Companies"; "Alternative Risk Transfer (ART)"; "Understanding BCAR for Property/Casualty Insurers"; and "Catastrophe Analysis in A.M. Best Ratings." Best's Credit Methodology can be found at www.ambest.com/ratings/methodology.

Founded in 1899, 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 © 2013 by A.M. Best Company, Inc. ALL RIGHTS RESERVED.

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