AM Best Revises Outlooks to Positive for RLI Corp. and Its Subsidiaries
AM Best has revised the outlook for RLI Corp. and its subsidiaries to positive from stable, while affirming their superior Financial Strength Rating (A+) and Long-Term Issuer Credit Ratings. The revision reflects RLI's consistently strong balance sheet fundamentals, prudent capital management, and favorable reserve development trends.
The company's risk-adjusted capitalization remained at the strongest level, with policyholder surplus growing significantly from $1.0 billion in 2019 to $1.8 billion by year-end 2024. RLI demonstrates strong operating performance across extended periods, driven by sound pricing discipline and diversification in specialty markets. The company maintains strong financial flexibility with modest financial leverage and robust fixed-charge coverage.
AM Best ha rivisto l'outlook di RLI Corp. e delle sue filiali, aggiornandolo da stabile a positivo, mentre conferma il loro superior Financial Strength Rating (A+) e i Long-Term Issuer Credit Ratings. Questa revisione riflette i solidi fondamentali del bilancio di RLI, una gestione prudente del capitale e tendenze favorevoli nello sviluppo delle riserve.
La capitalizzazione aggiustata per il rischio dell'azienda è rimasta ai livelli più elevati, con un surplus per i policyholder che è cresciuto significativamente da 1,0 miliardi di dollari nel 2019 a 1,8 miliardi di dollari entro la fine del 2024. RLI dimostra un forte rendimento operativo nel lungo periodo, sostenuto da una disciplina dei prezzi solida e dalla diversificazione nei mercati specializzati. L'azienda mantiene una forte flessibilità finanziaria con un modesto leverage finanziario e una robusta copertura delle spese fisse.
AM Best ha revisado la perspectiva de RLI Corp. y sus subsidiarias de estable a positiva, al tiempo que reafirma su superior calificación de solidez financiera (A+) y calificaciones de crédito del emisor a largo plazo. La revisión refleja los sólidos fundamentos del balance de RLI, una gestión prudente del capital y tendencias favorables en el desarrollo de reservas.
La capitalización ajustada por riesgo de la empresa se mantuvo en el nivel más fuerte, con un superávit para los titulares de pólizas que creció significativamente de $1.0 mil millones en 2019 a $1.8 mil millones para finales de 2024. RLI demuestra un fuerte rendimiento operativo a lo largo de períodos extendidos, impulsado por una sólida disciplina de precios y diversificación en mercados especializados. La empresa mantiene una fuerte flexibilidad financiera con un apalancamiento financiero moderado y una sólida cobertura de costos fijos.
AM Best는 RLI Corp.와 그 자회사의 전망을 안정적에서 긍정적으로 수정하며, 이들의 우수한 재무 건전성 등급(A+)과 장기 발행자 신용 등급을 확인했습니다. 이번 수정은 RLI의 지속적으로 강한 재무 상태, 신중한 자본 관리 및 유리한 준비금 개발 추세를 반영합니다.
회사의 위험 조정 자본화 비율은 가장 강력한 수준을 유지했으며, 보험 가입자 잉여는 2019년 10억 달러에서 2024년 연말까지 18억 달러로 크게 성장했습니다. RLI는 견고한 가격 책정 규율과 전문 시장에서의 다양성에 의해 장기간 동안 강한 운영 성과를 보여줍니다. 이 회사는 적당한 재무 레버리지와 강력한 고정 비용 커버리지를 갖춘 강력한 재무 유연성을 유지하고 있습니다.
AM Best a révisé les perspectives de RLI Corp. et de ses filiales, les passant de stable à positive, tout en affirmant leur notation de solidité financière (A+) et leurs notations de crédit à long terme. Cette révision reflète les fondamentaux solides du bilan de RLI, une gestion prudente du capital et des tendances favorables dans le développement des réserves.
La capitalisation ajustée au risque de l'entreprise est restée au niveau le plus élevé, avec un excédent pour les assurés passant de 1,0 milliard de dollars en 2019 à 1,8 milliard de dollars d'ici la fin de l'année 2024. RLI démontre une solide performance opérationnelle sur de longues périodes, soutenue par une discipline de prix rigoureuse et une diversification sur les marchés spécialisés. L'entreprise maintient une forte flexibilité financière avec un levier financier modeste et une solide couverture des charges fixes.
AM Best hat den Ausblick für RLI Corp. und deren Tochtergesellschaften von stabil auf positiv geändert und gleichzeitig deren überragende Finanzstärke (A+) und langfristige Emittenten-Kreditratings bestätigt. Die Änderung spiegelt die durchweg starken Bilanzgrundlagen von RLI, eine umsichtige Kapitalverwaltung und günstige Entwicklungen bei den Rückstellungen wider.
Die risikoadjustierte Kapitalisierung des Unternehmens blieb auf dem stärksten Niveau, wobei der Überschuss der Policeninhaber von 1,0 Milliarden Dollar im Jahr 2019 auf 1,8 Milliarden Dollar zum Ende des Jahres 2024 erheblich gewachsen ist. RLI zeigt über längere Zeiträume hinweg eine starke Betriebsergebnis, angetrieben durch disziplinierte Preisgestaltung und Diversifizierung in spezialisierten Märkten. Das Unternehmen behält eine starke finanzielle Flexibilität mit moderatem finanziellen Hebel und robuster Deckung der festen Kosten.
- Policyholder surplus increased 80% from $1.0B to $1.8B (2019-2024)
- Maintained highest possible risk-adjusted capitalization level
- Strong internal capital generation despite significant stockholder dividend payments
- Consistent strong underwriting results across market cycles
- Sound financial flexibility with modest leverage
- None.
Insights
AM Best's revision of RLI's outlook to positive represents a significant validation of the company's financial strength and business strategy. The maintenance of the A+ (Superior) rating, coupled with the positive outlook, positions RLI advantageously in the specialty insurance market, potentially leading to expanded business opportunities and enhanced market confidence.
The 80% growth in policyholder surplus over five years, reaching
Three key factors make this rating action particularly noteworthy for investors:
- The 'strongest' BCAR assessment provides a substantial buffer against market volatility and underwriting risks, reducing the likelihood of capital adequacy concerns
- The company's focus on underserved specialty markets, combined with strong risk management, has created a defensive business model less susceptible to traditional market cycles
- The modest financial leverage and strong fixed-charge coverage indicate significant untapped capacity for strategic growth initiatives or shareholder returns
The positive outlook suggests potential for further rating upgrades, which could lead to reduced cost of capital and expanded business opportunities in segments where high financial strength ratings are important for winning business. RLI's demonstrated ability to maintain superior performance across market cycles, coupled with its strategic focus on specialty markets, positions it well for sustained profitable growth.
The Credit Ratings (ratings) reflect RLI’s balance sheet strength, which AM Best assesses as strongest, as well as its strong operating performance, favorable business profile and very strong enterprise risk management.
The positive outlooks reflect the consistently favorable balance sheet strength fundamentals, supported by the group’s prudent capital management strategy, favorable reserve development trends, strong liquidity and sound asset liability management practices. The group’s risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR), remained at the strongest level as of year-end 2024, and is expected to be maintained at this level over the medium term. Strong and consistent internal capital generation has enabled RLI to grow its capital size considerably over the last five years (despite the return of significant capital in the form of stockholder dividends to RLI Corp.), with policyholder surplus reaching
RLI’s ratings also reflect strong operating performance across extended time periods and multiple underwriting cycles. The consistency in the group’s underwriting results is driven by sound pricing discipline, diversification, as well as risk optimization and continues to be augmented by solid investment returns. RLI’s sound risk management capabilities and focus on niche opportunities by concentrating on specialty markets that often are underserved has helped insulate it from the various stages of the traditional property/casualty market cycle. Further supporting the ratings are the strong financial flexibility afforded by RLI Corp., as evidenced by its modest financial leverage and strong fixed-charge coverage.
The FSR of A+ (Superior) and the Long-Term ICRs of “aa” (Superior) have been affirmed with the outlooks revised to positive from stable for the members of RLI Group:
- RLI Insurance Company
- Contractors Bonding and Insurance Company
- Mt. Hawley Insurance Company
This press release relates to Credit Ratings that have been published on AM Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best's Credit Ratings. For information on the proper use of Best’s Credit Ratings, Best’s Performance Assessments, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.
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Michael
Senior Financial Analyst
+1 908 882 2414
michael.venezia@ambest.com
Christopher Sharkey
Associate Director, Public Relations
+1 908 882 2310
christopher.sharkey@ambest.com
Rosemarie Mirabella
Director
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rosemarie.mirabella@ambest.com
Al Slavin
Senior Public Relations Specialist
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al.slavin@ambest.com
Source: AM Best
FAQ
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