AM Best has upgraded the Financial Strength Rating to B++ (Good) from B+ (Good) and the Long-Term Issuer Credit Rating to “bbb” (Good) from “bbb-” (Good) of Aspire General Insurance Company (Aspire General) (Rancho Cucamonga, CA). The outlook of these Credit Ratings (ratings) has been revised to stable from positive.

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

The rating upgrades reflect Aspire General’s improved underwriting and operating performance over the current five-year period, largely driven by management’s numerous initiatives to enhance profitability, namely the termination of agencies with poor performance and the implementation of rate increases. Additionally, the company is technologically advanced for its size and utilizes predictive analytics in its decision-making process with a heavy emphasis on managing loss frequency. Furthermore, data analytics and point-of-sale tools are used to target profitable segments and swiftly react to new business rate needs. Lastly, ownership has contributed capital to Aspire General in recent years to support new business growth and are willing to make additional contributions when warranted in the future.

Partially offsetting the positive factors are Aspire General’s above-average underwriting leverage, limited scale of operations and high reinsurance dependence. The elevated underwriting leverage has been impacted by significant premium growth primarily driven by policy growth and the implementation of rate increases on its Savings and Advantage products. Overall, the company has faced some challenges in the current California environment for non-standard automobile line driven by economic conditions, significant price competition and adverse selection from large personal automobile writers with greater scale and pricing granularity. However, the company relies on its experienced management team and highly rated reinsurers to manage its risks and remain profitable.

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.

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