AM Best Downgrades Safety Insurance Group Amid Capitalization Decline

AM Best has downgraded the long-term issuer credit ratings for key subsidiaries of Safety Insurance Group to 'a' from 'a-plus', while affirming its financial strength rating at A and revising the outlook to stable. This downgrade primarily reflects a deterioration in the group's risk-adjusted capitalisation, as measured by Best’s Capital Adequacy Ratio, driven by a decline in surplus and increases in net written premium, net reserves, and probable maximum loss estimates. Inflationary pressures and rate increases have also significantly impacted the group's financial metrics. Despite these challenges, AM Best characterizes Safety Insurance's business profile as neutral due to its steady position as a leading insurer in Massachusetts across personal auto, commercial auto, and homeowners markets with a moderately diverse product portfolio.