Financial Strength
The below four cornerstones illustrate why Medmarc is a financially secure company and trusted by companies of all sizes:
A.M. Best Rating
A- (Excellent) With Stable Outlook.
A. M. Best is the nation’s leading independent insurance rating agency. According to Best, an A- (Excellent) rated company has "an excellent ability to meet their ongoing responsibilities to policyholders". The stable outlook indicates "that [the company] is experiencing stable financial and market trends, and that there is a low likelihood that its rating will change in the near-term".
Best's Capital Adequacy Ratio (BCAR). Best's Capital Adequacy Ratio (BCAR) compares A. M. Best’s estimate of the capital necessary to support an insurer’s investment, credit and underwriting risks to the insurer’s economic surplus. Medmarc’s 2009 BCAR exceeds A. M. Best’s published minimum level for companies rated A++ (Superior).
Quality Reinsurance Partners
Medmarc is backstopped by reinsurers selected for their financial strength and capital size. Each is rated A (Excellent) or better by A.M. Best and in a Financial Size Category of XIV or higher.
The combined policyholder surplus of Medmarc's reinsurers as of December 31, 2010 exceeded $10 billion.
Capital Strength and Liquidity
Low Premium-to-Surplus Leverage. For each $1.00 of net written premium, Medmarc has $3.00 of policyholder surplus.
Strong Loss Reserves-to-Policyholder Surplus Position. For each $1.00 of net loss reserves, Medmarc has an additional $0.86 of policyholder surplus. Since 1986, Medmarc has experienced favorable development of its products liability loss reserves in 23 out of 25 years.
Strong Current Liquidity Position. For each $1.00 of liabilities, Medmarc has $1.65 of unencumbered cash and affiliated investments.
Surplus. During 2010, Medmarc grew surplus by 12% to its highest level in the Company’s history.
Conservative Investment Philosophy
As of December 31, 2010.
- The average S&P rating for Medmarc's fixed income portfolio was AA-
- No subprime investments are held
- No investments are other-than-temporarily impaired
- Medmarc does not invest in derivatives