The unsolicited counterparty credit rating on Markel Corp. (NYSE: MKL) is based on the company's strong competitive position in the excess and surplus (E&S) and specialty lines of business, as well as its strong capital adequacy and liquidity. In Standard&Poor's Ratings Services' view, these strengths are partially offset by Markel's underwriting performance, which is still strong but has declined as a result of incurred losses in mortgage insurance (in run-off), high catastrophe losses, and a high expense ratio amid a soft pricing environment. The rating also reflects potential for adverse reserve development on workers' compensation and legacy asbestos and environmental (A&E) reserves, and the significant investment risk stemming from high equity exposure and sector concentration. Markel has a
