Press Release|Insurance

KBRA Downgrades and Withdraws Rating for United Heritage Property & Casualty Company

4 Jan 2024   |   New York


KBRA downgrades the insurance financial strength rating (IFSR) for United Heritage Property & Casualty Company (UHPC) from from BBB+ to BBB-, removes the Watch Downgrade status and assigns a Stable Outlook. The downgrade reflects continued poor operating results in the first nine months of 2023 which have caused surplus to decline to $7.86 million, an approximately 35% decrease from year-end 2022, as well as the anticipated significant reduction in the size and scope of the company given the group's strategic decision to significantly realign and reduce risk in the P&C business written in UHPC. These actions are expected to negatively impact the company's earnings diversification and market position. Subsequently, KBRA withdraws the IFSR at the request of the company.

Key Credit Considerations

The rating reflects UHPC's low reserve leverage, consistent investment income and strong catastrophe reinsurance program. In addition, the company benefits from long-standing agency relationships and a management team with deep local knowledge. Balancing these strengths are UHPC's unfavorable underwriting performance, declining risk based capital levels, geographic risk concentration and catastrophe exposure.

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A description of all substantially material sources that were used to prepare the credit rating and information on the methodology(ies) (inclusive of any material models and sensitivity analyses of the relevant key rating assumptions, as applicable) used in determining the credit rating is available in the Information Disclosure Form(s) located here.

Information on the meaning of each rating category can be located here.

Further disclosures relating to this rating action are available in the Information Disclosure Form(s) referenced above. Additional information regarding KBRA policies, methodologies, rating scales and disclosures are available at

About KBRA

Kroll Bond Rating Agency, LLC (KBRA) is a full-service credit rating agency registered with the U.S. Securities and Exchange Commission as an NRSRO. Kroll Bond Rating Agency Europe Limited is registered as a CRA with the European Securities and Markets Authority. Kroll Bond Rating Agency UK Limited is registered as a CRA with the UK Financial Conduct Authority. In addition, KBRA is designated as a designated rating organization by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized by the National Association of Insurance Commissioners as a Credit Rating Provider.

Doc ID: 1002945

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