KBRA Affirms Ratings for US Coastal Property & Casualty Insurance Company and US Coastal Insurance Company
4 Sep 2026 | New York
KBRA affirms the Insurer Financial Strength Ratings (IFSRs) of BBB+ for US Coastal Property and Casualty Insurance Company (USCPC) and BBB for US Coastal Insurance Company (USCIC), both with Stable Outlooks.
Key Credit Considerations
The ratings for both entities reflect their sound risk-adjusted capitalization, conservative and high credit quality investment portfolios with limited investment risk, and experienced management team with a focused strategy and strong alignment of interests. USCPC has demonstrated improving profitability, reporting $8.7 million of cumulative net income from 2021 through 2025 and underwriting income in four of the last five years. The exception was 2024, when results were impacted by Hurricanes Debby, Helene and Milton. USCPC’s underlying attritional loss ratio has remained below 40%, reflecting strong underwriting and timely claims handling, with positive results continuing through the first half of 2026. USCIC’s profitability has been more volatile, with a cumulative net loss of approximately $1.1 million from 2021 through 2025, primarily reflecting underwriting losses in 2023 and 2024 associated with higher reinsurance costs and lower net premium levels. USCIC returned to underwriting and net profitability in 2025, although results through the first half of 2026 were adversely affected by winter storm activity.
Tempering these strengths are the companies’ geographic and product concentrations and significant exposure to natural catastrophes. USCPC writes close to 90% of its business in Florida, while USCIC is concentrated in New York, New Jersey and Rhode Island. Both companies primarily write homeowners insurance and are exposed to hurricanes as well as wildfires, severe convective storms, and convective and winter storms. These concentrations necessitate significant reliance on quota share and excess-of-loss reinsurance, creating exposure to the availability and pricing of future reinsurance capacity as well as counterparty credit risk. Additionally, management’s plans to grow in existing states carry execution risk.
Rating Sensitivities
Factors that could positively impact the ratings include sustained profitability that outperforms benchmarks through the cycle, organic surplus growth that results in lower surplus note leverage and a consistent trend of profitable expansion outside of Florida for USCPC.
Factors that could negatively impact the ratings include a material deterioration in risk-adjusted capitalization, a material negative variance to forecasts provided to KBRA, an unfavorable change in risk profile, catastrophe events that negatively impact earnings, the inability to obtain appropriate reinsurance and/or a material increase in surplus note leverage.
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