AM Best has affirmed the Financial Strength Rating (FSR) of A++ (Superior) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of “aa+” (Superior) of the members of The Hartford Steam Boiler Group (HSB). The outlook of these Credit Ratings (ratings) is stable. (See below for a detailed listing of the companies.)

The ratings reflect HSB’s balance sheet strength, which AM Best assesses as strongest, as well as its very strong operating performance, favorable business profile and very strong enterprise risk management.

HSB maintains risk-adjusted capitalization that is consistently within the group’s overall strongest balance sheet strength assessment, as measured by Best’s Capital Adequacy Ratio (BCAR). HSB’s very strong operating performance assessment is supported by consistently excellent profitability metrics, which have outperformed AM Best’s commercial property composite by a wide margin for a prolonged period of time. The very strong overall operating performance is driven primarily by superior underwriting returns and enhanced by a steady stream of investment income. HSB’s five-year average combined ratio of 84.8% significantly outperforms the 92.6% average posted by the commercial property composite over the same period. Underwriting margins continue to be favorable, reflecting continued strong results in the group’s commercial equipment breakdown business, cyber protection business, home systems protection and service line, despite continued inflationary pressures.

The group has a long-standing reputation as a valuable partner to insurance companies throughout the industry. This unique position allows the group to distribute its products throughout the United States, Canada and the United Kingdom, as well as other markets. Additionally, it allows its partners to access the specialized knowledge and innovative products the group provides to the industry, including the Internet of Things, deep engineering expertise and related risk management tools, as well as data insights, together with other innovative solutions, producing favorable returns. HSB’s recent growth is across several business lines, with cyber products seeing the strongest growth for the past several years. HSB manages its cyber risk accumulation through a combination of carefully tailored policy forms, cyber risk management services for the end insureds and a targeted risk selection strategy, as well as a sound risk management framework that includes the use of propriety capital model, strong reinsurance protection and defined risk tolerances.

The FSR of A++ (Superior) and the Long-Term ICRs of “aa+” (Superior) have been affirmed with stable outlooks for the following members of The Hartford Steam Boiler Group:

• The Hartford Steam Boiler Inspection and Insurance Company
• The Boiler Inspection and Insurance Company of Canada
• HSB Specialty Insurance Company
• HSB Engineering Insurance Limited

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.

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