KBRA Affirms Rating for Mutual Assurance Society of Virginia
15 Aug 2025 | New York
KBRA affirms the A+ Insurance Financial Strength Rating (IFSR) for Mutual Assurance Society of Virginia (MAS). The Outlook for the rating is Stable.
The rating reflects MAS’ robust risk-based capital which is supported by very conservative premium leverage and strong liquidity. The surplus position and MAS' low catastrophe exposure give MAS the ability to withstand extreme tail events, including a 1-1,000-year hurricane. Furthermore, MAS' strong commitment to mutuality and its members, its deep local market knowledge, long-standing agency relationships and the use of a perpetual homeowner’ policy, has resulted in customer retention approximately 95% for the last 10 years. The company's strict underwriting guidelines are designed to protect it from adverse selection and higher risk policies. MAS also reaps certain unique benefits operating as a Chapter 25 Mutual Assessment Property and Casualty Insurance Company in the Commonwealth of Virginia.
Offsetting these credit strengths are MAS’ heightened level of investment risk, with equities comprising approximately 71% of cash and invested assets on June 30, 2025. Just four individual stock holdings accounted for approximately 25% of the equity portfolio, which exposes the Society’s surplus to significant volatility, as was seen in 2020 and 2022, when MAS experienced large declines in their asset portfolio due to financial market downturns. However, equity market volatility is partially offset by MAS’ high-quality bond portfolio. Although aligned with its business model, MAS has unfavorable statutory metrics, with elevated loss and expense ratios. MAS is also subject to concentration risk, operating as a single-state insurer that writes primarily homeowners’ insurance. Furthermore, approximately 58% of the Society’s total insured value (TIV) is in the Richmond area.
Factors that could lead to an upgrade include a consistent trend in improved profitability, and reduced asset risk concentrations.
Factors that could lead to a downgrade include further concentration in invested assets, departures of key staff members without suitable replacement, further deterioration in underwriting results, exposure growth in excess of MAS’ ability to preserve surplus through reinsurance, or an inability to retain policyholders/members over the long term.
MAS is a mutual assessment property and casualty insurance company that primarily writes homeowners insurance, only in the Commonwealth of Virginia. Related insurance coverages include fire and allied lines written as dwelling property insurance and personal umbrella insurance.
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