AM Best Affirms Credit Ratings of Virginia Surety Seguros de México, S.A. de C.V.

AM Best has affirmed the Financial Strength Rating (FSR) of A- (Excellent) and the Long-Term Issuer Credit Rating (Long-Term ICR) of “a-” (Excellent) of Virginia Surety Seguros de México S.A. de C.V. (VSSM) (Mexico City, Mexico). The outlook of these Credit Ratings (ratings) is positive. AM Best also has affirmed the Mexico National Scale Rating (NSR) of “aaa.MX” (Exceptional) of VSSM. The outlook of the NSR is stable.

The ratings reflect VSSM’s balance sheet strength, which AM Best assesses as strong, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management.

The positive outlook on the FSR and Long-Term ICR reflects AM Best’s expectation that the company’s balance sheet strength will continue to improve, underpinned by positive bottom-line results. The company’s balance sheet strength has been assessed at a strong level since it began operations in Mexico. The ratings of VSSM also factor its recent affiliation and strategic importance to Assurant, Inc., the ultimate parent, as well as its risk-adjusted capitalization at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR).

VSSM is a subsidiary of Virginia Surety Company, Inc., a general underwriting entity part of The Warranty Group, Inc. In 2017, The Warranty Group, Inc. completed a merger agreement with Assurant, Inc., with the purpose of combining insurance operations in various jurisdictions, including the operation in Mexico. VSSM started operations in Mexico in January 2017, focused on the auto insurance line of business and other property/casualty business lines. VSSM also underwrites specialty products, offering coverage in cases of theft or accidental damage for consumer technology products, such as cellphones, photographic and sound equipment and home appliances. VSSM places its coverage products through its network of manufacturers, distributors and retailers.

VSSM operates under the same management as Assurant Daños México, S.A. and Assurant Vida México, S.A., subsidiaries of Assurant, Inc. These companies operate separately but do not compete against each other; moreover, VSSM takes advantage of the operational synergies derived from being part of the Assurant group.

Factors that could lead to positive rating actions for VSSM include a sustained reinforcement of its strong balance sheet strength, underpinned by risk-adjusted capitalization at the strongest level, as measured by BCAR, and favorable operating performance. Conversely, negative rating actions could take place if operating performance substantially deteriorates, resulting in a decline in risk-adjusted capitalization to a level no longer supportive of the current ratings.

This press release relates to Credit Ratings that have been published on AM Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best’s Credit Ratings. For information on the proper use of Best’s Credit Ratings, Best’s Performance Assessments, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.

AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City.

For more information, visit www.ambest.com.

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