AM Best has assigned a Financial Strength Rating of A (Excellent) and a Long-Term Issuer Credit Rating of “a” to EyeMed Insurance Company (EIC) (Phoenix, AZ). EyeMed is a wholly owned subsidiary of Luxottica U.S. Holdings Corp., which in turn is wholly owned by Luxottica Group S.p.A. (Luxottica). The outlook assigned to these Credit Ratings (ratings) is stable.
OLDWICK, N.J.--(BUSINESS WIRE)--AM Best has assigned a Financial Strength Rating of A (Excellent) and a Long-Term Issuer Credit Rating of “a” to EyeMed Insurance Company (EIC) (Phoenix, AZ). EyeMed is a wholly owned subsidiary of Luxottica U.S. Holdings Corp., which in turn is wholly owned by Luxottica Group S.p.A. (Luxottica). The outlook assigned to these Credit Ratings (ratings) is stable.
The ratings reflect EIC’s balance sheet strength, which AM Best categorizes as very strong, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management. The ratings consider EIC’s strategic importance to Luxottica, as well as the comprehensive operational support provided by the parent company.
EIC’s balance sheet strength assessment is based on the company’s risk-adjusted capitalization being at the very strong level, as measured by Best’s Capital Adequacy Ratio (BCAR), and solid capital generation from its core markets. The company has reported a steady increase in capital and surplus, primarily driven by favorable earnings. Additionally, the balance sheet strength assessment also considers the relatively low risk stemming from the company’s highly liquid investment portfolio. EIC had paid dividends in prior years and it is anticipated that future payments will be made; however, AM Best does not expect these to materially impact the company’s balance sheet strength assessment.
The company, which recently converted from a captive insurer, has historically exhibited relatively stable operating performance over the past several years, with earnings driven by growth in revenue and continued operating efficiencies. EIC has maintained steady premium growth, primarily a result of premiums assumed from other carriers. As part of the conversion to a commercial insurance entity, EIC is expected to begin writing premiums directly.
EIC is largely a monoline company; however, the organization has good diversification by geography and business sector. Following the recent merger between Luxottica and Essilor, an optical lens manufacturer, EIC will be maintained as a direct subsidiary of Luxottica and continue to operate as a separate legal entity. The new ultimate parent company is EssilorLuxottica.
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