AM Best's stable call on GUARD is conditional

AM Best revised the outlook on Berkshire Hathaway GUARD Insurance Companies to stable from negative on Aug. 12, affirming the A+ (Superior) Financial Strength Rating and "aa-" (Superior) Long-Term Issuer Credit Ratings of the five member companies—AmGUARD, EastGUARD, NorGUARD, WestGUARD and AZGUARD—under their intercompany pooling agreement. The outlook is the part of the announcement that carries information, because the negative outlook had been in place since August 2025, following underwriting losses in 2023, 2024 and 2025 that included material reserve strengthening in several lines, most notably commercial auto and business owners' policies.

AM Best's earlier negative outlook cited those losses and the steps GUARD took in response: discontinuing its underperforming admitted personal lines business entirely, re-underwriting the commercial auto and BOP books, and installing an almost entirely new senior leadership team over the two years before that assessment to restore operating performance. AM Best now credits two forces for the improved trajectory—continued explicit and implicit support from GUARD's immediate parent, National Indemnity Company, a Berkshire Hathaway subsidiary, and early positive results from the corrections implemented over the past two years.

AM Best calls the improvement recent and reserves the possibility of further action if results do not track peer benchmarks, a caveat that matters as much as the outlook itself. GUARD's own announcement framed the unchanged A+ as a sign of trust for agents, insureds and stakeholders, but the stable outlook tells a broker that AM Best sees credible evidence the commercial auto and BOP problems are being solved rather than continuing to deteriorate. Policyholders should read the stable outlook as confidence in the trend so far, not a declaration that the trend is permanent.

Parent support has bought time, and the stable outlook can be withdrawn if the trajectory reverses. That is the same discipline test AM Best has flagged for reinsurers heading into 2027, when record capital meets softening prices. GUARD is the primary-market version of that test: whether an A+ balance sheet can substitute for underwriting performance when a cycle turns. For now the answer is a provisional yes. The next two underwriting years, and the performance of that re-underwritten commercial auto book against peer benchmarks, will decide whether the provisional holds.