KBRA Publishes Ratings for US Coastal Property & Casualty Insurance Company and US Coastal Insurance Company; Affirms Both Ratings
5 Sep 2025 | New York
KBRA publishes the Insurer Financial Strength Ratings (IFSRs) of BBB+ for US Coastal Property and Casualty Insurance Company (USCPC) and BBB for US Coastal Insurance Company (USCIC), both with Stable Outlooks. These ratings were initially assigned with Stable Outlooks on November 14, 2022 on an unpublished basis. The outlook for USCPC was revised to Negative from Stable on October 24, 2023. Both ratings have been affirmed on September 5, 2025, with the Outlook for USCPC being revised to Stable from Negative.
The revision of USCPC’s outlook to Stable from Negative reflects KBRA’s expectation that profitability will continue in-line with forecasts, and that management will appropriately manage at-risk capital while reducing the company’s reliance on quota share reinsurance over time. The outlook for USCIC remains Stable, reflecting KBRA’s expectation that the company will make prudent decisions with respect to at-risk capital while executing its business plan over the medium term. Both outlooks also reflect KBRA’s expectation that the companies will continue to maintain their high credit quality, liquid investment portfolios.
USCPC is a property/casualty insurer focused on writing homeowners coverage primarily in Florida but also with operations in California, Mississippi and Alabama; USCIC is a property/casualty insurer focused on writing homeowners coverage in New York, New Jersey and Rhode Island. Both entities distribute through an affiliated Managing General Agency (MGA), Cabrillo Coastal, LLC (Cabrillo Coastal) and utilize Harbor Claims, LLC (Harbor Claims) for claims handling.
Key Credit Considerations
The ratings for both entities reflect their risk adjusted capitalization, a high credit quality investment portfolio with limited investment risk, and a solid liquidity profile with a short duration asset portfolio that is well matched to liabilities. While USCPC reported a net loss in 2020 due to elevated natural catastrophe events, KBRA views favorably USCPC’s attritional loss ratio that is driven by strong underwriting and claims handling at Cabrillo Coastal and Harbor Claims, respectively. USCIC has reported an aggregate net loss of $2.3 million for the period 2020 through 2024, driven primarily by underwriting losses in 2023. The management team is experienced in catastrophe-exposed underwriting, is aligned with the company through ownership interests, and operates both companies within a clearly defined market niche. Both companies’ reinsurance programs were bolstered in 2025, including top layers related to catastrophe bonds providing multi-year coverage.
Tempering these strengths are the companies’ geographic concentration in Florida and the coastal areas of New York and New Jersey that exposes both entities to natural catastrophes and makes them dependent on reinsurance. USCPC and USCIC have product concentration in personal lines property products (primarily homeowners). USCPC has only reported favorable reserve development in two of the last five years, while USCIC has reported unfavorable reserve development in each of the last five years.
Rating Sensitivities
Factors that could positively impact the ratings include improved profitability, organic surplus growth and a consistent trend of profitable expansion outside of Florida for USCPC.
Factors that could negatively impact the ratings include a material deterioration in risk-adjusted capitalization, a material negative variance to forecasts provided to KBRA, an unfavorable change in risk profile, catastrophe events that negatively impact earnings, the balance sheet and/or the ability to obtain appropriate reinsurance and/or a material increase in surplus note leverage.
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