Steamship Mutual Group

The stable outlook reflects our expectation that Steamship's capital adequacy will remain in the 'AAA' category over the next two years. We also expect the club's underlying (excluding COVID-19) underwriting performance to slowly improve over the next two years. We might lower the rating if, contrary to our expectations over the next two years, significant underwriting losses resulted in Steamship being unable to sustain capital comfortably at the 'AAA' level in our risk-based capital model. We do not anticipate raising the rating over the next two years. An upgrade would likely depend on Steamship expanding its product diversity without compromising operating performance. COVID-19 will lead to a global recession during 2020. We forecast GDP will fall 5.2% in the U.S.

...Steamship will maintain a strong competitive position in the P&I sector. We expect Steamship will maintain its strong reputation in the P&I sector for both its service excellence and operating performance. Its disciplined approach to underwriting and management's continuing focus on servicing customer needs will allow the club to maintain its strong retention levels and will enable the club to maintain an underwriting balance over the long term, despite the impact of COVID-19. Steamship's capital position is likely to remain extremely strong. Steamship has generated over $177 million in surpluses in the past five years, which has allowed the club to build a significant excess of capital over our '###' level according to our risk-based model. Despite challenging conditions in the sector, we believe the club will comfortably sustain a surplus over our '###' benchmark over the next two years. Steamship also has the ability to make unbudgeted calls on members a significant factor in our choice...

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