AM Best Affirms 'A' Financial Strength Ratings for Ally Insurance Group
AM Best has affirmed the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Ratings of "a" (Excellent) for Ally Insurance Group's members, including Motors Insurance Corporation and its subsidiaries, as well as an affiliate domiciled in Bermuda.
This affirmation reflects Ally Insurance's strongest balance sheet strength, adequate operating performance, a neutral business profile, and effective enterprise risk management. The group's balance sheet strength is supported by a strong risk-adjusted capitalization measured by Best's Capital Adequacy Ratio, modest underwriting leverage, embedded economic equity in unearned premium reserves, and a moderate investment risk profile. Despite significant dividend payments to Ally Financial Inc., surplus growth has remained stable due to disciplined underwriting and steady investment income.
The group faced challenges in operating performance during 2024 and early 2025, primarily from weather-related losses in the auto physical damage line and increased losses in the guaranteed asset protection (GAP) product due to used vehicle value normalization and ongoing macroeconomic pressures in the auto industry.
These factors were partially mitigated by reinsurance and offset by top-line growth driven by rate increases, exposure expansion, and collaboration with Auto Finance. Ally Insurance's business profile remains neutral, supported by its specialized focus on vehicle service contracts and GAP products across the U.S. and Canada, and its role as a leading provider of commercial auto physical damage insurance for dealer vehicle inventories in the U.S.
The group's innovative processes and risk management capabilities are aligned with its parent company, supporting its strategic partnerships and operational stability. The stable outlook on the credit ratings indicates AM Best's expectation that Ally Insurance will maintain a strong balance sheet and adequate operating results, facilitating surplus growth to support its expanding book of business.