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AM Best Removes From Under Review With Developing Implications and Affirms Credit Ratings of Southern Trust Insurance Company

AM Best has removed from under review with developing implications and affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Rating (Long-Term ICR) of “a-” (Excellent) of Southern Trust Insurance Company (Southern Trust) (Macon, GA). The outlook assigned to these Credit Ratings (ratings) is negative.

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

Southern Trust’s ratings were initially placed under review with developing implications on June 28, 2023, following the announcement that it signed a share and interest purchase agreement with Arbour National (Arbour). The under review with developing implications status reflected the potential for key overall balance sheet strength considerations to be solidified post-closing, while also reflecting the need to evaluate medium term strategic expectations after the transaction was finalized.

In conjunction with the agreement’s regulatory approval and closing, Southern Trust’s capital position was enhanced by a $20 million capital contribution. The balance sheet is further insulated from losses through a prudent reinsurance program with strong partners. Arbour is focused on providing Southern Trust with resources and capital support to successfully execute ongoing business plans. As part of the agreement, Southern Trust will continue to operate independently, while being majority owned by Arbour. Additionally, emphasis has been placed on maintaining rate adequacy across multiple lines of business through enhanced technology to improve the overall quality of the book of business. However, efforts have yet to gain traction and the negative outlook on the Long-Term ICR reflects pressure on the adequate operating performance assessment given continued volatility in results in 2023, impacted by weather losses, inflationary pressures, rate adequacy challenges and unfavorable reserve trends, producing results that materially deviated from historical norms. AM Best will continue to monitor Southern Trust’s results for sustained operating and loss reserve development improvement.

This press release relates to Credit Ratings that have been published on AM Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best's Credit Ratings. For information on the proper use of Best’s Credit Ratings, Best’s Performance Assessments, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.

AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit

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