National Unity Insurance Company, based in San Antonio, Texas, has received a positive boost from AM Best, the insurance rating agency. AM Best upgraded the outlook for the company’s Long-Term Issuer Credit Rating (Long-Term ICR) from stable to positive. At the same time, the agency confirmed the company’s Financial Strength Rating (FSR) at B++ (Good) and kept the Long-Term ICR rating at “bbb” (Good). The outlook on the Financial Strength Rating remains stable.
This change reflects National Unity’s steady progress since leaving the non-standard auto insurance market in 2020. That exit helped the company avoid the ups and downs it used to face, leading to stronger and more consistent financial results. As a result, its risk-adjusted capital and surplus have improved and stayed solid through several business cycles. The company has added to its surplus every year for the past five years.
National Unity’s financial position looks healthier, with both net and gross leverage metrics showing favorable trends. These numbers are better than the average for similar insurers in the commercial auto sector. The company also keeps its risk low by having common stock leverage in the low single digits, which limits its exposure to swings in the stock market.
Investment returns have been steady too. The company focuses on a conservative investment approach, mainly holding bonds, which has helped keep income consistent. On top of that, underwriting and operating cash flows have been positive every year over the last five years. This positive cash flow supports strong liquidity, with current ratios better than industry averages.
In short, AM Best’s upgrade signals confidence in National Unity’s financial strength and steady improvement. This marks an encouraging step for the San Antonio insurer as it continues to build on its solid foundation and steady performance.