S&P Global Ratings has upgraded its assessment of WR Berkley and says the insurer’s decentralised business model enabling rapid responses to shifting market conditions supports strong profitability.

The financial strength rating on WR Berkley’s core insurance subsidiaries has moved to AA- from A+, while the long-term issuer credit rating on holding company WR Berkley Corp has been raised to A- from BBB+. The outlook is stable.

“The upgrade reflects our view that WRB’s capital adequacy and overall credit fundamentals have improved,” the ratings agency said.

“The rating action also underscores the company’s ability to consistently generate strong operating earnings with low volatility, comparable with those of its AA- rated peers.”

S&P says WR Berkley is among the largest liability insurers in the US, with gross written premium of $US15.1 billion ($21.2 billion) last year and a specialty-oriented portfolio.

The company is likely to continue expanding its excess and surplus casualty business amid favourable premium rates this year and next, it adds.

WR Berkley’s premium grew at an average of 11.4% over the past five years and it delivered an average reported combined operating ratio of 89.9%, or 92.4% including corporate expenses, according to the ratings agency. 

The company is expected to stay disciplined on rate adequacy amid rising claims inflation, while underwriting performance should remain strong and less volatile than peers, with a combined operating ratio of 90%-93%, including about 3 points of catastrophe load in 2026-27. 

“We believe ongoing economic and social inflation, in combination with rising natural catastrophe exposure, could contribute to elevated earnings volatility,” S&P said. “However, as an offsetting factor, we believe WRB will continue to deliver strong and stable operating performance.”