Universal North America Insurance Company (UNAIC), based in Arlington, Texas, is facing continued pressure on its financial ratings. Rating agency AM Best has kept UNAIC’s Financial Strength Rating at B (Fair) and its Long-Term Issuer Credit Rating at “bb” (Fair), while placing them under review with negative implications.
This review has been in place since October 2023, initially triggered by a sharp drop in UNAIC’s policyholder surplus due to severe weather events that year. The company’s ratings were downgraded again on February 12, 2025, following a significant ownership change. This change involved the sale of UNAIC’s holding company, Universal Insurance Holdings of North America, and an affiliated managing general agent, finalized on January 31, 2025.
AM Best highlighted concerns about UNAIC’s modest business performance and limited market presence. The firm also pointed to “marginal” risk management and an adequate but not strong balance sheet. The ratings remain under review as UNAIC’s management works on updating their business plan and figuring out a new strategy to manage capital under the new ownership.
The new parent company, 5B Alliance, LLC, and its ultimate owner—a private individual—add another layer of uncertainty about the company’s financial stability. AM Best wants to see how the new structure will impact UNAIC’s future before making a final call on the ratings.
For now, the insurance company is in a holding pattern as it rebuilds and reassures investors and customers alike. The insurance market will be watching closely to see if UNAIC can steady itself during this transitional period.