AM Best awards preliminary credit rating to Omaha National Insurance Company

OLDWICK, New Jersey– (BUSINESS WIRE) –
AM Best assigned a preliminary credit score (PCA) to Omaha National Insurance Company (ONIC) (Omaha, NE) with a financial strength rating of A-pca (Excellent) and a long-term issuer credit rating of “a-” pca (Excellent). The outlook attributed to these PCAs is stable.

The BCPs reflect the strength of ONIC’s balance sheet, which AM Best considers to be very strong, as well as its adequate operational performance, limited business profile and appropriate enterprise risk management (ERM).

The very strong balance sheet valuation reflects ONIC’s highest level of risk-adjusted capitalization, as measured by Best’s capital adequacy ratio (BCAR), on a pro forma basis for a $ 35 million capital contribution from the intermediary parent company of the company, Omaha National Group, Inc. (NGO), following his August 2021 The issuance of Series B convertible preferred shares and the planned issuance of a $ 20 million external surplus note. While NGO is capitalized primarily with convertible preferred shares, resulting in high financial leverage as per AM Best guidelines, PCAs recognize the characteristics of convertible NGO preferred shares, the parent company’s adequate liquidity position and the continued capital support from investors.

AM Best assesses the operational performance of the company as adequate based on the historical results of ONIC since its inception in October 2017 and its well-defined business plan, and considers a level of execution risk associated with the company’s plan to begin writing business produced by its affiliate managing general agent, Omaha National Underwriters, LLC (UN), on a direct basis. ONIC assumes all of its premium through a quota agreement with an unaffiliated border carrier, Preferred professional insurance company (PPIC). The business is produced by the UN, which manages all aspects of policies sold through PPIC. AM Best considers that the commercial profile of the company is limited because ONIC is a single line insurer of insurance against accidents at work with a geographical concentration in California. ONIC’s ERM capabilities benefit from rigorous claims monitoring, established risk tolerance levels and strict underwriting guidelines.

This press release relates to preliminary credit reports that have been posted on the AM Best website. For all assessment information relating to the press release and relevant disclosures, including details of the office responsible for issuing each of the individual assessments referenced in this press release, please see the Recent rating activity Web page. For more information on the use and limitations of rating and credit assessment notices, please see Best Credit Score Guide. For more information on the proper use of Best’s credit scores, Best’s preliminary credit reports, and AM Best’s press releases, please see Guide to Proper Use of Best Ratings and Reviews.

AM Best is a global credit rating agency, news publisher, and data analytics provider specializing in the insurance industry. Based at United States, the company operates in more than 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico. For more information visit www.ambest.com.

Copyright © 2021 by AM Best Rating Services, Inc. and / or its affiliates. ALL RIGHTS RESERVED.

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Robert valentina, CPCU

Senior Financial Analyst

+1 908 439 2200, ext. 5291

[email protected]

Christophe sharkey
Manager, Public Relations

+1 908 439 2200, ext. 5159

[email protected]

Jacqalene Lentz, CPA

Director

+1 908 439 2200, ext. 5762

[email protected]

Jim peavy
Director, Communications

+1 908 439 2200, ext. 5644

[email protected]

Source: AM Best


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