Concert secures AM Best A- rating for new E&S carrier CSIC
Fronting start-up Concert Group Holdings’s newly formed E&S carrier Concert Specialty Insurance Company (CSIC) has secured an A- financial strength rating (FSR) from AM Best.
The new Montana-domiciled platform will work alongside the group’s admitted carrier Concert Insurance Company (CIC).
“We formed Concert to provide a higher level of client focus and responsiveness to captive and program clients that have been underserved,” said CEO Jonathan Reiss.
“With both an admitted and an E&S carrier, we now have the ability to write business on a broad basis, offering a full range of risk solutions to our clients.”
The executive said CSIC “nicely complements our admitted platform”, and “it offers a targeted approach that supports the captive and program administrator marketplaces”.
“Our experienced team can deliver creative, customized solutions to MGAs, program administrators, captive managers and reinsurance partners, helping them serve customers and clients with evolving, hard-to-place risks,” Reiss added.
Concert was formed back in June by Strategic Risk Solutions CEO Brady Young, Southern Insurance Underwriters CEO Wes Duesenberg and Corinthian Re CEO Christopher Collins in partnership with Century Equity Partners and WT Holdings.
Launch of the E&S carrier has been on the cards since Concert was first formed, with Young telling The Insurer back in June that formation of such a platform was being considered.
According to AM Best, CSIC will write surplus lines business across the US, apart from in Montana where business will be underwritten on an admitted basis.
Initially, CSIC will focus on captive-fronted business, diversified geographically and by class.
Traditional program business will also be a focus. The programs will be administered by managing general agencies and program administrators located across the US.
In October, Concert completed a $100mn capital raise with support from Freedom Underwriters, Century Equity Partners and WT Holdings. That raise coincided with an announcement from AM Best that it had raised CIC’s financial strength rating from B+ to A-, and its long-term issuer credit rating from “bbb-” to “a-”.
CSIC secures A- FSR
AM Best said the A- FSR and “a-” credit ratings reflect CSIC’s “very strong” balance sheet, along with its adequate operating performance, limited business profile and appropriate enterprise risk management (ERM).
According to AM Best, the ratings factor in the recent capital raise undertaken by CSIC’s owners - Freedom Underwriters, Century Equity Partners and WT Holdings - and the subsequent downstreaming of a portion of the proceeds into CSIC.
A similar capital infusion was made into CIC in October.
The remainder of the capital raised resides at the holding company level, and that will be used to fund the platform’s future growth and facilitate broader licensing and expansion initiatives going forward, AM Best explained.
As measured by Best’s Capital Adequacy Ratio, CSIC’s risk-adjusted capitalisation is assessed at the strongest level. CSIC’s capitalisation is supportive of its planned growth initiatives and expected increased reinsurance utilization in the coming years.
“As the management team has extensive relationships in the reinsurance and insurance-linked securities (ILS) markets, AM Best expects CSIC’s reinsurance panel to be well-balanced between the traditionally rated market and fully collateralized reinsurance market, as well as being highly diversified,” the ratings agency said.
CSIC’s “adequate” operating performance is based upon its management’s “clearly defined business plan”, AM Best said, as well as projections that are closely aligned with the company’s new strategy.
The ratings also reflect CSIC’s limited business profile, which is in its early stages and is expected to improve over time, the ratings agency added.
AM Best’s “appropriate” ERM assessment is based on CSIC being directed and governed by new leadership and a board that has established its own risk framework, risk tolerances and risk appetite.