AM Best Revises Issuer Credit Rating Outlook to Negative for Queen City Assurance, Inc. and Vine Court Assurance Incorporated

Underwriting deterioration drove the negative outlooks, while positive earnings and investment income supported the insurance group.

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OLDWICK, N.J.--(BUSINESS WIRE)-- AM Best has revised the outlook to negative from stable for the Long Term-Issuer Credit Rating (Long-Term ICR) and affirmed the Financial Strength Rating (FSR) of A (Excellent) and the Long-Term ICR of “a+” (Excellent) of Queen City Assurance, Inc. and Vine Court Assurance Incorporated, both domiciled in Burlington, VT, and collectively referred to as Queen City Assurance Group (the group). The outlook of the FSR is stable.

The Credit Ratings (ratings) reflect the group’s balance sheet strength, which AM Best assesses as strongest, as well as its strong operating performance, neutral business profile and appropriate enterprise risk management (ERM).

The negative outlooks reflect AM Best's concerns regarding the deterioration in the group's underwriting performance in recent years, which, if sustained, could pressure operating performance such that it no longer supports the current assessment. The group’s underwriting results weakened in 2024, due to an uncharacteristically high level of property losses, and deteriorated further in 2025, driven by elevated casualty losses, including adverse reserve development, as well as pressure from the medical expense containment program. However, overall earnings remained positive, underpinned by solid investment income.

The group’s level of risk-adjusted capitalization is assessed at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR). In addition, the group consistently maintains strong liquidity measures while adhering to a conservative investment philosophy. The ratings also consider the financial flexibility afforded to the companies via their publicly traded parent, The Kroger Co. (Kroger) [NYSE: KR], one of the largest companies in the food retail industry. The neutral business profile assessment reflects a broadly diversified range of coverages that the group provides Kroger across its extensive operations. AM Best recognizes the group as an integral part in Kroger's overall ERM framework, with financial resources and support available to them as single-parent captives providing tailored insurance coverage for property/casualty risks. AM Best expects the parent's ability and willingness to support the captives will not change.

AM Best remains the leading rating agency of alternative risk transfer entities, with more than 200 such vehicles rated in the United States and throughout the world. For current Best’s Credit Ratings and independent data on the captive and alternative risk transfer insurance market, please visit www.ambest.com/captive.

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 www.ambest.com.

Copyright © 2026 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.

View source version on businesswire.com: https://www.businesswire.com/news/home/20261008724997/en/

Luke Davies
Financial Analyst
+1 908 882 2467
luke.davies@ambest.com

Connor Brach, CFA, RFM
Associate Director
+1 908 882 1668
connor.brach@ambest.com

Christopher Sharkey
Associate Director, Public Relations
+1 908 882 2310
christopher.sharkey@ambest.com

Al Slavin
Senior Public Relations Specialist
+1 908 882 2318
al.slavin@ambest.com

Source: AM Best

Key Terms

long term-issuer credit rating regulatory

A long term-issuer credit rating is an independent agency’s opinion of a borrower's overall ability and willingness to meet its financial obligations that come due more than about 12 months in the future. It assesses the issuer’s creditworthiness as a whole (typically for senior unsecured debt) by considering factors such as cash flow generation, debt levels, business risk, and economic environment; it is distinct from short-term ratings and from ratings on a specific debt issue, which may reflect legal or structural differences.

financial strength rating regulatory

A financial strength rating is an assessment of an organization's overall financial health, indicating how well it can meet its financial commitments. Think of it as a report card that shows whether a company or institution is financially stable and capable of withstanding economic challenges. This rating helps investors gauge the level of risk involved in engaging with or investing in that organization.

adverse reserve development financial

An increase in an insurer's loss reserves because claims turned out larger or more costly than previously estimated. It means a company raises the liability it holds for past policy periods after reviewing claim experience or new information; the increase is recorded in the insurer’s financial statements and reduces reported underwriting profit for the period when the adjustment is made. Adverse reserve development typically relates to prior accident or policy years (including incurred-but-not-reported claims) and reflects a deterioration in past loss estimates rather than new underwriting in the current period.

single-parent captives financial

A single-parent captive is an insurance company created and wholly owned by one business to insure that owner’s risks instead of buying coverage from outside insurers. Think of it as a company setting up its own private safety net to pay for accidents, liability, or other losses that affect its operations. It matters to investors because it changes how a company manages risk, cash flow, reserve volatility, and regulatory or tax exposure, which can affect reported earnings and balance sheet strength.