AM Best Rating & Homeowners Insurance Impact FAQ

Recently AM Best, an agency that analyzes the financial strength of insurance companies for consumer insight updated their rating of California Casualty from B++ with a negative outlook to B with a stable outlook.

The FAQs below address the reasons for the rating update and what this may mean to you.

Their rating change reflects the significant financial pressures the insurance industry has been experiencing over the last 18 months. Although AM Best’s rationale highlighted that California Casualty’s capital adequacy ratio is strong and the balance sheet is adequate, they updated our rating to a B given our underwriting losses over the same 18-month period of time.

If your mortgage lender has chosen Freddie Mac as the underwriter for your loan, you may receive a letter from your lender notifying you of the AM Best rating update. As these letters differ by lender, please contact your lender directly to determine if there is any action that you need to take.

If your lender advises that an alternative carrier is needed, please contact California Casualty’s Agency Services Department at 877-652-2638 or email, as we may be able to find other insurance options.

You can use the My Home by Freddie Mac look-up tool to determine if your loan is underwritten by Freddie Mac.

No. Freddie Mac is the only mortgage loan underwriting company that we are aware of that requires an AM Best rating that is higher than a B. For example, Fannie Mae requires a financial rating of B or better, which California Casualty continues to maintain.

No. If you have an auto loan or are leasing a vehicle that is insured with California Casualty, there is no action necessary.

Many auto and home insurance companies have been impacted by unprecedented inflation and weather-related events. For a number of companies, this has resulted in an unfortunate drop in financial ratings by rating companies like AM Best. 

Yes. Rest assured that California Casualty has the necessary capital to continue serving our customers and the ability to pay any potential claims.

This rating change does not change the high quality of service that we provide, the ability to fulfill promises to all policyholders, or the outlook for the future strength of the company. You can continue to count on the exceptional service you deserve.