AM Best has removed from under review with positive implications and upgraded the credit ratings of Folgate Insurance Company Limited, an US and international hybrid fronting carrier, and affirmed Hadron Specialty Insurance Company’s credit ratings.
Folgate’s Financial Strength Rating (FSR) was upgraded to A- (Excellent) from B (Fair) and the Long-Term Issuer Credit Rating (Long-Term ICR) to “a-” (Excellent) from “bb+” (Fair) with a stable outlook.
Hadron Specialty Insurance Company’s affirmed ratings include FSR of A- (Excellent) and Long-Term ICR of “a-” (Excellent).
Together these companies comprise the Hadron group. Upon regulatory approval of the Folgate Insurance Company Limited will be renamed as Hadron UK Insurance Company.
The recent ratings actions from AM Best reflect Hadron’s strong balance sheet and strategic direction.
Hadron’s expects these ratings will continue to drive the momentum of the company’s differentiated and diverse portfolio of insurance partners across the US and UK.
AM Best stated: “The very strong balance sheet strength assessment is supported by the group’s risk-adjusted capitalization, which is assessed currently at the strongest level through the start-up period based on the initial financing structure, as measured by Best’s Capital Adequacy Ratio (BCAR).
“Hadron group’s operating performance assessment of adequate anticipates that the group’s results will fall within a range of reasonable and expected outcomes for a fronting services organization, which will have a diverse population of managing general agents and credible reinsurance partners.”
Given the execution risk associated with a start-up fronting organisation, Hadron group’s business profile is limited, according to AM Best assessment.
Hadron was founded in November 2023 with over $250mn in capital support from Altamont Capital Partners, and it efficiently expanded into the UK market earlier this year by acquiring Folgate Insurance Company Ltd (FICL).
The group is now entering a competitive area of the industry and will have to develop traits to separate itself from peers through the construction of core competencies, AM Best noted.
The agency also recognized Hadron’s planned implementation of a start-up ERM structure that includes risk management, mitigation efforts and clearly defined reinsurance program provisions.
Sam Reeder, CEO, commented: “We are delighted with the early momentum we have achieved and the high-quality talent we have attracted to our platform. Hadron is well capitalized and committed to serving the needs of specialty MGAs and our reinsurance partners, providing them the data integrity, efficiency, and underwriting acumen they are looking for.”
