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AM Best Removes From Under Review With Developing Implications and Downgrades Credit Ratings of Connecticut Attorneys Title Insurance Company

AM Best has removed from under review with developing implications and downgraded the Financial Strength Rating to B (Fair) from B++ (Good) and the Long-Term Issuer Credit Rating to “bb” (Fair) from “bbb” (Good) of Connecticut Attorneys Title Insurance Company (CATIC) (Essex Junction, VT). The outlook assigned to these Credit Ratings (ratings) is stable.

The ratings reflect CATIC’s balance sheet strength, which AM Best assesses as weak, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management (ERM).

The ratings reflect AM Best’s revised assessment of CATIC’s overall balance sheet strength to weak from adequate due to the significant drop-off in CATIC’s risk-adjusted capitalization; this was prompted by a contraction in surplus and available capital despite the capital infusion received from its parent in the fourth quarter of 2024. This sudden decline was also the result of higher-than-expected net premium leverage and the consequential deterioration in risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR). AM Best also considers an additional level of required capital for CATIC due to a potentially large loss that is currently in the process of being resolved. The stable outlooks reflect AM Best's expectation that CATIC will return to profitability in 2025 and maintain a level of risk-adjusted capitalization that is commensurate with its current balance sheet strength assessment.

CATIC’s weaker than expected combined and operating ratios of late are due to its higher-than-average expense ratio in support of its expansion efforts. CATIC continues to maximize investment growth while concurrently deploying expense reduction initiatives to alleviate its high expenses and improve its operating results. The limited business profile reflects the concentration that CATIC has as a monoline title insurer. AM Best views CATIC’s ERM as appropriate as the company has an established framework with a defined risk appetite and tolerances that are utilized to articulate the level and type of risks that are acceptable to CATIC. CATIC has an appropriate reinsurance program, which enables it to write commercial business, cover defalcation risk, and social engineering risks.

This press release relates to Credit Ratings that have been published on AM Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best's Credit Ratings. For information on the proper use of Best’s Credit Ratings, Best’s Performance Assessments, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.

AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.

Copyright © 2025 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.

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