A.M. Best Revises Outlook to Negative for Sutter 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 A- (Excellent) and issuer credit rating of “a-” of Sutter Insurance Company</org> (Sutter) (Petaluma, CA).

The affirmation of the ratings reflects Sutter’s solid risk-adjusted capitalization, well-established market presence in California and generally favorable operating performance augmented by consistent investment income. In addition, management has made changes to certain underwriting strategies that are anticipated to favorably impact overall results going forward.

These positive rating factors are somewhat offset by Sutter’s recent unprofitable underwriting performance and rapid premium growth, which has resulted in a downward trend in risk-adjusted capitalization. The negative outlook recognizes A.M. Best’s concern with the possibility of continued underwriting volatility, which may potentially put further pressure on Sutter’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 the world’s oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com.

Copyright © 2011 by A.M. Best Company, Inc.ALL RIGHTS RESERVED.

A.M. best CompanyMichael T. Venezia, 908-439-2200, ext. 5034
Senior Financial Analyst
[email protected]
orJeffrey Mango, CPA, 908-439-2200, ext. 5035
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 Company