A.M. Best affirms, upgrades RSA Canada companies’ ratings

Rating agency A.M. Best affirmed and upgraded ratings for RSA Group of Canada’s companies.

Best affirmed the financial strength rating of “A” (excellent) and issuer credit rating of “a” of Royal & Sun Alliance Insurance Company of Canada (RSA Canada) and Western Assurance Company, as well as Quebec Assurance Company.

Those companies, known together as the RSA Canadian Property/Casualty pool, had their ratings affirmed because of “strong risk-adjusted capitalization, solid investment income and sound reserve development,” according to Best.

The company also upgraded the FSR of Vancouver’s Canadian Northern Shield Insurance Company (CNS) from “B” (fair) to “B+” (good), and its ICR from “bb+” to “bbb-.”

That rating upgrade is partly because of increased distribution and growth opportunities within British Columbia, where a majority of RSA Canada’s premiums are written, Best said. It did point out that CNS’s elevated underwriting leverage, high underwriting expenses and fluctuating operating performance will continue to challenge the company.

Best also upgraded the FSR of Unifund Assurance Company from “B” to B++.” It also upgraded its ICR from “bb+” to “bbb.” That upgrade credits Unifund’s continued improved risk-adjusted capital, consistent operating performande and favourable reserve development, Best said.

It also affirmed the “B+” (good) FSR and “bbb-“ ICR for Ascentus Insurance Ltd., based on its “solid level of risk-adjusted capitalization,” Best said. 

The insurance companies are all collectively known as the RSA Group of Canada, and are subsidiaries of Roins Financial Services Ltd., the Canadian immediate holding company for RSA Insurance Group plc, based in the U.K.

The rating agency has, however, withdrawn the ratings for the United Kingdom-based parent company, as the parent company has requested to no longer participate in the ratings process.