AM Best Assigns Credit Ratings, Stable Outlook to Workers’ Comp Writer SUNZ
AM Best has assigned a Financial Strength Rating of A- (Excellent) and a Long-Term Issuer Credit Rating of “a-” (Excellent) to SUNZ Insurance Co. of Bradenton, Florida. The outlook assigned to these Credit Ratings (ratings) is stable.
AM Best said the ratings reflect “SUNZ’s balance sheet strength, which the ratings organization assesses as very strong, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management.”
SUNZ was formed in 2005 and primarily writes high deductible worker’s compensation coverage through its proprietary technology-driven platform focused on collateral management for its medium and small business clients.
AM Best said SUNZ’s balance sheet assessment is supported by its risk-adjusted capitalization as measured by Best’s Capital Adequacy Ratio (BCAR) in current periods, projected future scores, and under stress scenarios. The SUNZ balance sheet assessment also considers the capital contributions in support of recent premium growth, improved reserving patterns exhibited during the recent five-year period, its comprehensive reinsurance program diversified among highly rated participants, and a conservative investment portfolio that matches assets with liabilities.
AM Best analysts assess SUNZ’s operating performance is as adequate as evidenced by average pre-tax return on revenue measures that trail AM Best’s workers’ compensation industry composite over the recent five- and 10-year timeframe. They note that SUNZ’s business profile assessment is limited as 49.9% of premiums are written in two states, California and Florida, when considering both direct and assumed premiums. Operating as a single line workers’ compensation insurer, SUNZ’s limited business profile exposes the company to the potential legislative, regulatory or judicial changes occurring within these states, according to AM Best.
SUNZ recently expanded its footprint to include Colorado, Hawaii, Iowa, Nevada, New Hampshire, New Mexico, South Carolina, South Dakota, Utah, Vermont, Virginia, West Virginia and Wisconsin.
In late 2020, Blackstone Tactical Opportunities acquired what SUNZ termed a “significant stake” in the company. Terms of that transaction were not disclosed.
SUNZ Holdings is the parent company of SUNZ Insurance. There are several affiliate companies within the SUNZ Holdings including Next Level Administrators, WatchPoint, Avalon Subrogation Partners, and Ascential Care Partners.