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AM Best Affirms Credit Ratings of Spirit Insurance Company and Radius Insurance Company

  • AM Best affirmed the Financial Strength Rating of A (Excellent) & Long-Term Issuer Credit Ratings of "a" (Excellent) for Spirit Insurance Company & Radius Insurance Company.
  • The outlook for both ratings is stable.
  • Ratings reflect very strong balance sheets, adequate operating performance, neutral business profiles, & appropriate enterprise risk management for both captives.
  • Spirit & Radius benefit from financial flexibility & support as captive insurers for their parent, Phillips 66.
  • Loss experience has remained favorable due to Phillips 66's strong loss-control program & a relatively small number of material catastrophe losses.
  • Spirit provides property, business interruption, construction all-risks, excess liability, & employee medical reimbursement insurance for Phillips 66's domestic U.S. operations, excluding Texas-based risks.
  • Radius provides similar coverage for Phillips 66's non-U.S. risks, with premiums & exposures decreasing after removing U.K. property exposures in 2022.
  • Both captives face low frequency, high severity loss claims & rely significantly on reinsurance protection.
  • Spirit's terrorism coverage is heavily mitigated by reinsurance under the federal Terrorism Risk Insurance Program Reauthorization Act, which expires in 2027.