Adirondack Insurance Exchange, an insurance carrier writing personal lines coverages only in New York, has lost its financial stability rating (FSR) from Demotech. The carrier announced the May 28 action to its agents and policyholders that afternoon. Demotech, an Ohio-based financial analysis firm that provides FSRs for insurance companies, did not offer an explanation on its website for the move.
Adirondack agents received email notifications late on May 28. The carrier, a member of the Allstate Insurance Group, posted this update for policyholders on its website:
“Demotech, Inc., a provider of financial stability ratings of property-casualty insurance companies, has withdrawn its financial stability rating for the Adirondack Insurance Exchange. This could impact you if you have a mortgage with a lender that requires you to carry homeowners insurance with an insurer that has a minimum financial stability rating. If you are impacted, your lender will notify you and we encourage to you to work with your Independent Agent and to evaluate options available to you. Adirondack will mail a letter notifying policyholders of this rating change.”
Big I New York members who have placed coverage with Adirondack may want to consider contacting affected clients. Our ebook The Big I NY Big Book of Form Letters & Other E&O Tools contains a form letter for contacting an insured whose carrier has been downgraded. The letter can be adapted to fit this situation. The book is a free member benefit for Big I New York members; non-members can download it at a cost of $99.00.