KBRA Affirms Ratings for Star Vantage Reciprocal Exchange and Apex Star Reciprocal Exchange; Revises Outlook to Negative for Star Vantage Reciprocal Exchange
26 Jun 2026 | New York
KBRA affirms the BBB Insurance Financial Strength Ratings (IFSRs) of Star Vantage Reciprocal Exchange ("Star Vantage") and Apex Star Reciprocal Exchange ("Apex Star"). The Outlook for Star Vantage has been revised to Negative from Stable while the Outlook for Apex Star remains Stable.
The change in outlook to Negative from Stable for Star Vantage reflects a highly competitive property market in Florida that has impacted both inception to date and future expected profitability. The current business plan has material variances for premium and surplus growth relative to the initial business plan provided to KBRA. Execution risk remains, with premium growth expected to be driven by non-admitted business in Florida, including a personal property product that will launch later in 2026.
The Stable outlook for Apex Star reflects KBRA’s expectation that the reciprocal will maintain adequate capitalization while executing its business strategy as an admitted property writer in Florida and a non-admitted property writer in other states. Additionally, KBRA expects the reciprocal to retain key members of the management team, preserve conservative underwriting leverage and maintain a high credit quality investment portfolio.
Key Credit Considerations
The ratings reflect both companies’ low underwriting leverage and conservative investment portfolios that are fully held in cash and cash equivalents. Additionally, as recently formed start-up insurers, Star Vantage and Apex Star have no legacy liabilities.
Balancing these strengths are the companies’ high financial leverage due to over 100% of Apex Star’s surplus base and nearly 100% of Star Vantage’s surplus base consisting of surplus notes. While both companies are targeting growth in the Florida property market that has benefited from legislative reforms, they face increased competition that has put pressure on rates. As a result, there is execution risk around both companies achieving their latest premium growth targets. Furthermore, as property writers in the Southeast, both companies have product and geographic concentration, natural catastrophe exposure due to hurricanes and high reinsurance dependence that, depending on availability and affordability, could materially impact results. Lastly, Star Vantage and Apex Star have a small team of experienced insurance professionals in place, presenting key person risk.
Rating Sensitivities
A material favorable variance to business plans provided to KBRA including a faster reduction of financial leverage, a consistent trend in organic surplus growth, improved financial flexibility and access to capital and/or a favorable change in risk profile could result in positive rating action.
A material unfavorable variance to business plan provided to KBRA, significant weather events that materially impact earnings and capital, an unfavorable change in risk profile, an inability to obtain reinsurance on acceptable terms and pricing, causing an increase in loss exposure, a reduction in the company’s ability to underwrite policies or a drag on earnings and/or a departure of key members of the management team without suitable replacement could result in negative rating action.
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