AM Best Revises Issuer Credit Rating Outlook to Positive for Credit Ratings of W. R. Berkley Corporation and Its Subsidiaries

AM Best has revised the outlooks to positive from stable for the Long-Term Issuer Credit Rating (Long-Term ICR) and Long-Term Issue Ratings (Long-Term IRs) and affirmed the Long-Term ICR of "a-" (Excellent) of W. R. Berkley Corporation (W. R. Berkley) (Greenwich, CT) (NYSE:WRB) and all associated Long-Term IRs and indicative Long-Term IRs for securities issued by W. R. Berkley. At the same time, AM Best has revised the outlooks to positive from stable for the Long-Term ICRs and affirmed the Financial Strength Rating (FSR) of A+ (Superior) and the Long-Term ICRs of "aa-" (Superior) of Berkley Insurance Company (Wilmington, DE) and its pooled or reinsured subsidiaries and affiliates, collectively referred to as W. R. Berkley Insurance Group (Berkley Group). AM Best also has revised the outlook to positive from stable for the Long-Term ICR and affirmed the FSR of A+ (Superior) and the Long-Term ICR of "aa-" (Superior) of Berkley Life and Health Insurance Company (Berkley Life and Health) (Urbandale, IA). The outlook of the FSR is stable. (See below for a detailed list of the companies and ratings.)

The Credit Ratings (ratings) of Berkley Group reflect its balance sheet strength, which AM Best assesses as strongest, as well as its strong operating performance, favorable business profile and appropriate enterprise risk management (ERM).

The Long-Term ICR outlook revision to positive from stable reflects Berkley Group's favorable operating performance metrics and its outperformance of industry trends over the most recent five-year period. Berkley Group continues to generate strong double-digit returns and has reported record top- and bottom-line growth in each of the past few years. In the first quarter of 2024, Berkley Group reported net premium growth across its core lines of business, with GAAP return on equity of 23.7%. AM Best expects that the group will continue to produce favorable results while growing its core businesses, as well as outperforming industry benchmarks and its peers on a long-term basis.

The group continues to maintain favorable market share in its core lines of business, as well as growth organically through new businesses and opportunities. Berkley Group's core strength is its decentralized business model and its ability to compete effectively in various markets. The group maintains a recognized presence in multiple domestic and international markets and its diverse distribution and portfolio of products are drivers of favorable trends reported over the past five-year period. Berkley Group's effective ERM practices and risk modeling capabilities are supportive of its current investment and operational risks, as demonstrated by the lack of volatility of financial results and overall robust capitalization of the enterprise.

Berkley Group's balance sheet strength assessment is anchored by its consistent strongest level of risk-adjusted capitalization, as measured by Best's Capital Adequacy Ratio (BCAR). Debt leverage has trended downward in the past five-year period and was 20.8%, adjusted as of year-end 2023. Additionally, the group's interest coverage and liquidity metrics remain strong. Berkley Group effectively maintains a diversified portfolio of investments to support its liabilities and is focused on creating the most favorable return while maintaining its risk tolerance levels.

The ratings of Berkley Life and Health reflect its balance sheet strength, which AM Best assesses as strongest, as well as its adequate operating performance, neutral business profile and appropriate ERM. The ratings also reflect the financial and operational support of the parent company.

Berkley Life and Health's balance sheet strength assessment is supported by its risk-adjusted capitalization assessed at the strongest level, as measured by BCAR. The company has strengthened its risk-adjusted capitalization annually in each of the last five years, while also maintaining conservative, high-quality investments and favorable liquidity metrics.

Berkley Life and Health continues to grow premium, driven by new and renewal sales of its group captive and medical stop-loss products. The company has reported increasing pre-tax net operating gains in recent years, due mainly to favorable underwriting experience.

Berkley Life and Health is a market leader in the group captive market and maintains a market niche in the small group medical stop-loss space. However, the medical stop-loss market is highly competitive and is dominated by larger national carriers. The company receives explicit and implicit support from W. R. Berkley, and is fully integrated into the parent organization's operations, strategic plans and ERM program.

The FSR of A+ (Superior) and the Long-Term ICRs of "aa-" (Superior) have been affirmed with the outlooks of the Long-Term ICRs revised to positive from stable, while the outlook of the FSR is stable, for the following members of W. R. Berkley Insurance Group:

• Acadia Insurance Company
• Admiral Indemnity Company
• Admiral Insurance Company
• Berkley Casualty Company
• Berkley Assurance Company
• Berkley Insurance Company
• Berkley National Insurance Company
• Berkley Prestige Insurance Company
• Berkley Regional Insurance Company
• Berkley Specialty Insurance Company
• Carolina Casualty Insurance Company
• Clermont Insurance Company
• Continental Western Insurance Company
• Firemen's Insurance Company of Washington, D.C.
• Gemini Insurance Company
• Great Divide Insurance Company
• Intrepid Casualty Company
• Intrepid Insurance Company
• Intrepid Specialty Insurance Company
• Key Risk Insurance Company
• Midwest Employers Casualty Company
• Nautilus Insurance Company
• Preferred Employers Insurance Company
• Queen's Island Insurance Company, Ltd.
• Riverport Insurance Company
• StarNet Insurance Company
• Tri-State Insurance Company of Minnesota
• Union Insurance Company
• Union Standard Lloyds
• W. R. Berkley Europe AG
• Berkley International Seguros Mexico S.A.
• Berkley International Fianzas Mexico S.A.

The following Long-Term IRs have been affirmed with the outlooks revised to positive from stable:

W. R. Berkley Corporation—

-- "a-" (Excellent) on $250 million, 6.25% senior unsecured notes, due 2037

-- "a-" (Excellent) on $350 million, 4.75% senior unsecured notes, due 2044

-- "a-" (Excellent) on 470 million, 4.0% senior unsecured notes, due 2050

-- "a-" (Excellent) on $400 million, 3.55% senior unsecured notes, due 2052

-- "a-" (Excellent) on $350 million, 3.15% senior unsecured notes, due 2061

-- "bbb+" (Good) on $185 million, 5.7% subordinated debentures, due 2058

-- "bbb+" (Good) on $300 million, 5.1% subordinated debentures, due 2059

-- "bbb+" (Good) on $250 million, 4.25% subordinated debentures, due 2060

-- "bbb+" (Good) on $300 million, 4.125% subordinated debentures, due 2061

The following indicative Long-Term IRs under the shelf registration have been affirmed with the outlooks revised to positive from stable:

W. R. Berkley Corporation—

-- "a-" (Excellent) on senior unsecured debt

-- "bbb+" (Good) on subordinated debt

-- "bbb" (Good) on preferred stock

W. R. Berkley Capital Trust III—

-- "bbb" (Good) on preferred securities

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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