AM Best Downgrades Credit for Kingstone Insurance Company; Downgrade and Liquidation of Kingstone Companies, Inc.

OLDWICK, NJ, July 29, 2022–(BUSINESS WIRE)–AM Best has lowered the Financial Strength Rating to B (Fair) from B+ (Good) and the Long Term Credit Rating (ICR) to “bb” (Fair) from “bbb-” (Good) for Kingstone Insurance Company ( KICO) (Kingston, NY). At the same time, AM Best has lowered the Long-Term ICR to “b-” (Marginal) from “bb-” (Fair) and its shares of Kingstone Companies, Inc. (KINS) (Delaware), a KICO insurance company. . The Credit Shares view (shares) has been changed to negative from default. At the same time, AM Best has also removed all KINS ratings. See below for details on KINS’ Long-Term Issue Credit Ratings (Term-Term IR) and Indicative Credit Ratings which were also withdrawn.

KICO’s ratings reflect its bank’s strength, which AM Best considers adequate, as well as its operational efficiency, its small business portfolio and its management of marginal enterprise risk (ERM).

The decline in the rating was driven by a significant decline in KICO’s risk-adjusted funds that occurred throughout the return period due to an increase in gross margin (PML); This was due to the recent restructuring of the insurance, as well as a decrease in the excess income from weather-related losses and dividend payments in 2022. The main difference in PMLs was driven by the loss of the catastrophe insurance market in June, which led to the insolvency of the management. get protection. the same limit as the previous year and buy less insurance as a result. This has led AM Best to revise KICO’s ERM assessment to less than ideal. The largest possible loss after one year in 100 losses will cause the company to incur significant losses starting in Q1/2022. Therefore, the company’s risk, tolerance, and new insurance structure are not compatible with a proper ERM assessment. The change in credit rating to negative reflects a record deterioration in the end of 2021 and the first quarter of 2022 that was mainly due to weather damage.

AM Best considers that KICO is affected by environmental, social and management issues due to the coastal areas and the risks of climate and climate change. In addition, KICO’s overall PML over 100-year returns remains elevated, putting pressure on leverage.

The following Long-Term IR was downgraded with revised outlook to neutral, and public interest was subsequently withdrawn, for Kingstone Companies, Inc.:

— to “ccc+” (Weak) from “bb-” (Fair) on $30.0 million 5.5% senior unsecured notes, due 2022

The following long-term IR ratings have been downgraded with revised ratings to neutral, and public interest was subsequently withdrawn, for Kingstone Companies, Inc.:

— to “ccc+” (Weak) from “bb-” (Fair) for large unsecured notes
— to “ccc” (Weak) from “b+” (Marginal) in the lower notes

This article relates to the Credit Ratings published on the AM Best website. For more information on ratings related to issuance and relevant disclosures, including details of the office responsible for issuing all ratings listed in this publication, please see AM Best’s. Recent Actions Web page. For more information on the application and limitations of the Credit Rating concept, please see Best’s Credit Ratings Guide. To learn more about the best use of Best’s Credit Ratings, Best Practice Reviews, Best Practice Reviews and Best Practice Reviews by AM Best Press releases, please check Tips for Effectively Using Quality Scores & Tests.

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

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