A.M. Best Downgrades Issuer Credit Rating of Affinity Mutual Insurance Company

OLDWICK, N.J.--(BUSINESS WIRE)-- A.M. Best has downgraded the Long-Term Issuer Credit Rating (Long-Term ICR) to “bbb” from “bbb+” and affirmed the Financial Strength Rating (FSR) of B++ (Good) of Affinity Mutual Insurance Company (AMIC) (Lima, OH). The outlook of the Long-Term ICR has been revised to stable from negative, while the FSR outlook remains stable.

The ratings reflect AMIC’s balance sheet strength, which A.M. Best categorizes as very strong, as well as its marginal operating performance, limited business profile and appropriate enterprise risk management.

The rating actions reflect the volatility in AMIC’s underwriting and operating performance over the past five years, most significantly in 2012, 2014, and 2015. The company’s underwriting results were impacted by weather-related events and fire losses, coupled with a historically elevated underwriting expense structure. The rating actions also reflect AMIC’s risk-adjusted capitalization being at the strongest level, low underwriting leverage and strong balance sheet liquidity. These positive rating attributes are offset somewhat by AMIC’s exposure to weather-related events due to geographic concentration of risk, as well as high product risk of the business it typically writes.

This press release relates to Credit Ratings that have been published on A.M. Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see A.M. Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Understanding Best’s Credit Ratings. For information on the proper media use of Best’s Credit Ratings and A.M. Best press releases, please view Guide for Media - Proper Use of Best’s Credit Ratings and A.M. Best Rating Action Press Releases.

A.M. Best is the world’s oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com.

Copyright © 2017 by A.M. Best Rating Services, Inc. and/or its subsidiaries. ALL RIGHTS RESERVED.

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A.M. Best

Christopher Jackson, +1-908-439-2200, ext. 5721

Financial Analyst

christopher.jackson@ambest.com

or

Brian O’Larte, +1-908-439-2200, ext. 5138

Associate Director

brian.o'larte@ambest.com

or

Christopher Sharkey, +1-908-439-2200, ext. 5159

Manager, Public Relations

christopher.sharkey@ambest.com

or

Jim Peavy, +1-908-439-2200, ext. 5644

Director, Public Relations

james.peavy@ambest.com

Source: A.M. Best