AM Best has affirmed the financial strength rating of A (Excellent) and the long-term issuer credit rating of “a” (Excellent) of Bermudian-based Ardellis Insurance Ltd.

The outlook of these credit ratings is stable.

The ratings reflect Ardellis’s balance sheet strength, which AM Best assesses as very strong, as well as its strong operating performance, limited business profile and appropriate enterprise risk management.

Ardellis is a wholly owned subsidiary of UFP Industries, and provides reimbursement coverage for medical stop-loss, workers’ compensation, general liability, automobile physical damage liability, property and trade credit receivables to its parent and its subsidiaries.

UFP, which began in Michigan nearly 70 years ago as a lumber supplier to the housing industry, is today a multibillion-dollar holding company with subsidiaries around the globe that serve retail, industrial and construction markets.

In addition, the ratings agency said, Ardellis provides coverages for medical stop-loss, excess property and excess general liability coverages for unrelated parties. Approximately 54 per cent of Ardellis’s premium represents third-party business.

Ardellis’s balance sheet strength remains very strong, supported by the strongest level of risk-adjusted capitalisation, as measured by Best’s capital adequacy ratio.

AM Best said: “The company’s operating performance has been favourable, with loss and expense ratio metrics that, on average, have outperformed the general property/casualty industry driven by underwriting expertise, safety and loss control practices, as well as low overhead.

“AM Best considers Ardellis’s ERM framework and risk management capabilities appropriate for its risk profile. Furthermore, Ardellis benefits from being an integral part of its parent’s ERM framework.”