AM Best goes negative on Realign, including Summit companies
Ratings agency AM Best has revised its outlook to negative for Realign Insurance Group, which includes American Summit, National Summit and Summit Specialty Insurance.
The ratings agency affirmed the carrier’s financial strength rating of A, and its long-term issuer rating of A.
The outlook revision was driven by concerns over the carrier’s “unfavorable operating performance in recent years” due to declining underwriting results, AM Best said Friday.
Realign has experienced “an elevated level” of fire and weather-related losses and a general increase in both severity and frequency, the ratings agency said, and has needed capital support from its parent company to support ongoing expansion plans.
“Realign’s management is addressing the volatility through rate increases, aggressive re-underwriting of its book of business, non-renewing of risks in certain territories and increasing mandatory deductibles in weather prone areas,” AM Best said, but failure to execute could affect its currently adequate operating performance.
Dallas-based Realign launched E&S programs carrier Summit in 2020 as part of a spate of new E&S start-ups after acquiring specialty property carrier American Summit from Align Financial earlier that year.
This publication has noted that a Golden Age of surplus lines outperformance largely continues in the US, but loss cost inflation and increasing cat losses could hamper that growth.