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A.M. Best Affirms Ratings of Gateway Rivers Insurance Company

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A.M. Best has affirmed the financial strength rating of A-(Excellent) and the issuer credit rating of “a-” of Gateway Rivers Insurance Company (Gateway) (Dallas, TX). The outlook for both ratings is stable.

The ratings and outlook reflect Gateway’s strong capitalization and conservative operating strategy. The ratings also consider the company’s critical role and favorable profile as part of the AT&T Inc. [NYSE:T] organization, as well as its excellent operating performance during the past five years, providing insurance coverage to subsidiaries of AT&T Inc. for certain property/casualty risks.

Partially offsetting these positive rating factors are Gateway’s relatively large limits to its property lines of business. Nevertheless, A.M. Best recognizes the substantial financial resources of the AT&T Inc. organization.

A.M. Best views Gateway’s management and corporate strategy as a major factor that strengthens its ratings, given its conservative underwriting, operational goals and transparency. A.M. Best believes that Gateway’s enterprise risk management practices are strong given their impact on the company’s conservative risk culture and defined risk controls, in addition to optimizing its capital and surplus. Other factors A.M. Best considered in the rating process include, but are not limited to, the diversification in Gateway’s line of business and geography, as well as the support and commitment of its parent and the captive’s mission.

A.M. Best expects Gateway’s future operating performance to be stable but strong, and the stable earnings profile should further support the efforts to control its growth and business writings, which are consistent with its capital and surplus position.

Gateway’s ratings are not expected to be upgraded and/or its outlook revised within the next 12-24 months as its operating performance and capital position already have been considered in the rating process. A.M. Best could downgrade the company’s ratings and/or revise the outlook if its Best’s Capital Adequacy Ratio score declines, operating performance and risk profile deteriorate, insured losses deplete capital, significant changes and turnover occur in its management team and/or risk management controls and tolerances or its parent’s ratings deteriorate.

A.M. Best remains the leading rating agency of alternative risk transfer entities, with more than 200 such vehicles rated in the United States and throughout the world. For current Best’s Credit Ratings and independent data on the captive and alternative risk transfer insurance market, please visit www.ambest.com/captive.

The methodology used in determining these ratings is Best’s Credit Rating Methodology, which provides a comprehensive explanation of A.M. Best’s rating process and contains the different rating criteria employed in the rating process. Best’s Credit Rating Methodology can be found at www.ambest.com/ratings/methodology.

Key insurance criteria reports utilized:

  • Alternative Risk Transfer (ART)
  • Evaluating Non-Insurance Ultimate Parents
  • Risk Management and the Rating Process for Insurance Companies
  • The Treatment of Terrorism Risk in the Rating Evaluation
  • Understanding BCAR for Property/Casualty Insurers

This press release relates to rating(s) that have been published on A.M. 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 visit A.M. Best’s Ratings & Criteria Center.

A.M. Best Company is the world’s oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com.

Copyright (c) 2015 by A.M. Best Company, Inc. ALL RIGHTS RESERVED.

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