BCRM parameters have been updated


Pools that are A.M. Best rated, or use Best's Capital Adequacy Relativity (BCAR) scoring as a measure of financial solvency, may wish to review updates to Best's Credit Rating Methodology (BCRM) implemented Oct. 13, 2017. 
While not impacting fundamental rating criteria or core components of the BCAR analysis, BCRM changes do establish a new "building block" approach to the analytics process and utilize a stochastic BCAR formula.

And, BCRM uses a Value at Risk (VaR) metric to evaluate catastrophic loss impact on capital adequacy. Comments and questions directed to A.M. Best have included note of these VaR measures, in particular the validity of return periods at the end of the VaR curve of 1:500 (99.8) and 1:1000 (99.9), and the impact of multiple catastrophic events occurring within the same year.

Additional information, including video summaries, comments to A.M. Best, and Q&A documents, are available on the A.M. Best website.

Back to news