KBRA Affirms Ratings for Heritage Insurance Holdings, Inc. and Three Operating Subsidiaries, all with Stable Outlooks
18 Dec 2025 | New York
KBRA affirms the insurance financial strength ratings (IFSRs) for three operating subsidiaries of Heritage Insurance Holdings, Inc. (HIH) (NYSE: HRTG): BBB+ for Heritage Property & Casualty Insurance Company (HPCIC), BBB+ for Narragansett Bay Insurance Company, Inc. (NBIC), and BBB for Zephyr Insurance Company (ZIC). Further, KBRA affirms the issuer rating of BBB- for HIH. The Outlooks for all ratings are Stable.
The ratings for all entities (collectively, Heritage) reflect its well-integrated operations, adequate capitalization, conservative investment portfolio, seasoned management team and continued execution of its long-term strategy to diversify the group’s exposures. Through a controlled growth strategy, Heritage’s plan serves to mitigate concentration risk by targeting product growth, including commercial residential and Excess & Surplus lines business.
The cash flows from non-regulated service operations have helped to provide capital support as needed. The Heritage operating companies are also members of the FHLB, affording HPCIC, NBIC, and ZIC access to additional, low-cost borrowing capability and liquidity. Additionally, KBRA views Heritage’s distribution, including agency networks and large strategic partnerships, as a favorable credit consideration. Heritage also maintains a sound reinsurance program with high credit quality carriers and reduced retentions for subsequent events.
Balancing these strengths are the organization’s elevated operating losses over the last five years, reflective of exposure to natural catastrophes, specifically hurricanes and winter storms. Nonetheless, results in 2024 and year-to-date 2025 have improved for all carriers, most notably HPCIC. While diversification efforts advance, HPCIC continues to be a significant Florida writer and approximately 29% of the group’s TIV and close to 50% of its premiums are derived from the state. Heritage relies heavily on reinsurance as a risk mitigant.
To access ratings and relevant documents, click here.
Click here to view the report.