AM Best: Negative Rating Implications from Wildfires for California Capital and Subsidiaries
AM Best has placed under review with negative implications the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Ratings of “a-” of California Capital Insurance Co. and its subsidiaries Eagle West Insurance Co., Monterey Insurance Co. and Nevada Capital Insurance Co.
The rating actions follow management’s discussion with AM Best regarding the potential losses related to the Camp and Woolsey wildfires in California in November.
“Based upon current estimates, gross ultimate losses will far exceed losses previously contemplated in Capital’s ratings,” AM Best stated in an announcement on the rating change.
The status reflects the need for AM Best to fully assess the financial and operational impacts of the wildfire activity and Capital’s response to these events. Despite the expected gross and net losses, risk-adjusted capital currently remains supportive of the ratings, according to AM Best.