A.M. Best Revises Outlook to Negative for IFA Insurance Company

OLDWICK, N.J.--(BUSINESS WIRE)-- A.M. Best Co. has revised the outlook to negative from stable and affirmed the financial strength rating of B++ (Good) and issuer credit rating of “bbb” of IFA Insurance Company (IFA) (Clark, NJ).

The affirmation of the ratings reflects IFA’s adequate risk-adjusted capitalization, its longtime experience in the New Jersey automobile marketplace and conservative investment portfolio with consistent investment income. In addition, the company continues to refine its underwriting criteria and implement rate increases.

These positive factors are somewhat offset by IFA’s unprofitable operating performance in recent years, as a result of the adverse trends in bodily injury and personal injury protection loss experience in the New Jersey personal automobile market. As a result, a downward trend in risk-adjusted capitalization has occurred in recent years, in conjunction with elevated underwriting leverage ratios. The negative outlook reflects a concern with continuing deterioration in underwriting results, putting further pressure on IFA’s risk-adjusted capitalization.

The principal methodology used in determining these ratings is Best’s Credit Rating Methodology -- Global Life and Non-Life Insurance Edition, which provides a comprehensive explanation of A.M. Best’s rating process and highlights the different rating criteria employed. Additional key criteria utilized include: “Risk Management and the Rating Process for Insurance Companies” and “Understanding BCAR for Property/Casualty Insurers.” Methodologies can be found at www.ambest.com/ratings/methodology.

Founded in 1899, A.M. Best Company is a global full-service credit rating organization dedicated to serving the financial and health care service industries, including insurance companies, banks, hospitals and health care system providers. For more information, visit www.ambest.com.

A.M. Best Co.Raymond Thomson, ARM, 908-439-2200, ext. 5621
Financial Analyst
[email protected]
orJeffrey Mango, CPA, 908-439-2200, ext. 5204
Assistant Vice President
[email protected]
orRachelle Morrow, 908-439-2200, ext. 5378
Senior Manager, Public Relations
[email protected]
orJim Peavy, 908-439-2200, ext. 5644
Assistant Vice President, Public Relations
[email protected]

Source: A.M. Best Co.