KBRA Places the IFSR for Stillwater Insurance Company, Issuer Rating for WT Holdings, Inc., and the Debt Rating for the $60 million notes due 2028 on Watch Downgrade
3 May 2023 | New York
KBRA places on Watch Downgrade the A- Insurance Financial Strength Rating (IFSR) for Stillwater Insurance Company (Stillwater). KBRA also places on Watch Downgrade the Issuer Rating of BBB- for WT Holdings, Inc. and the Debt Rating of BBB- on the $60 million notes due 2028.
The Watch Downgrade reflects the deterioration in Stillwater's capital position due to its elevated combined ratio. Stillwater had approximately $110 million underwriting losses in 2022 and Stillwater's RBC ratio declined from 472.6% at YE 2021 to 284.2% at YE 2022. Given that Stillwater is materially important to WT Holdings, its Issuer and Debt ratings are impacted as well.
Rating Sensitivities
The Watch Downgrade could result in a ratings downgrade if Stillwater’s surplus position is no longer supportive of the ratings. Additionally, if the company continues to experience underwriting losses the rating could be downgraded.
The ratings could be affirmed if capital levels remain supportive of the ratings or any needed capital enhancement initiatives are implemented.
ESG Considerations
To access rating and relevant documents, click here.