AM Best Revises Outlooks to Negative for Kemper Corporation, Its Affiliates and Subsidiaries
AM Best has revised the outlooks to negative from stable and affirmed the Financial Strength Rating (FSR) of A (Excellent) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of “a” (Excellent) of the property/casualty subsidiaries and affiliated insurance companies of
The ratings of Kemper P&C reflect its balance sheet strength, which AM Best categorizes very strong, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management (ERM). The ratings of Kemper L&H reflect its balance sheet strength, which AM Best assesses as strongest, as well as its adequate operating performance, neutral business profile and appropriate ERM.
With respect to the parent company, AM Best notes that
The negative rating outlooks for Kemper P&C—the lead rating unit of the group—and for
Underlying the significant deterioration in underwriting performance was a sharp rise in claims severity in the automobile line of business, which accounts for approximately 95% of Kemper P&C’s premium volume, largely reflecting significant supply chain issues, labor shortages and inflationary pressures. The automobile line of business also experienced higher claim costs, as well as a higher claim frequency, particularly in the latter half of 2021. Kemper L&H reported positive net income of
The negative outlooks for
The negative outlooks for Kemper L&H primarily reflects that operation’s significantly smaller scale within the organization, and AM Best’s view that its credit profile is therefore a function of its intrinsic strength and that of its P&C insurance affiliate and holding company.
A return to strengthened profitability and improved capital strength for
The FSR of A (Excellent) and the Long-Term ICRs of “a” (Excellent) have been affirmed with the outlooks revised to negative from stable for the members of the
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Trinity Universal Insurance Company -
Alpha Property & Casualty Insurance Company -
Capitol County Mutual Fire Insurance Company -
Charter Indemnity Company -
Financial Indemnity Company -
Infinity Insurance Company -
Infinity Assurance Insurance Company -
Infinity Auto Insurance Company -
Infinity Casualty Insurance Company -
Infinity Indemnity Insurance Company -
Infinity Preferred Insurance Company -
Infinity Safeguard Insurance Company -
Infinity Security Insurance Company -
Infinity Select Insurance Company -
Infinity Standard Insurance Company -
Infinity County Mutual Insurance Company -
Kemper Independence Insurance Company -
Merastar Insurance Company -
Mutual Savings Fire Insurance Company -
Kemper Financial Indemnity Company -
Old Reliable Casualty Company -
Response Insurance Company -
Response Worldwide Direct Auto Insurance Company -
Response Worldwide Insurance Company -
Union National Fire Insurance Company -
United Casualty Insurance Company of America -
Unitrin Advantage Insurance Company -
Unitrin Auto and Home Insurance Company -
Unitrin County Mutual Insurance Company -
Unitrin Direct Insurance Company -
Unitrin Direct Property & Casualty Company -
Unitrin Preferred Insurance Company -
Unitrin Safeguard Insurance Company -
Valley Property & Casualty Insurance Company -
Warner Insurance Company
The FSR of A (Excellent) and the Long-Term ICRs of “a” (Excellent) have been affirmed with the outlooks revised to negative from stable for the members of
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United Insurance Company of America -
Mutual Savings Life Insurance Company -
The
Reliable Life Insurance Company -
Union National Life Insurance Company -
Reserve National Insurance Company
The following Long-Term IR has been affirmed, with the outlooks revised to negative from stable:
Kemper Corporation—
-- “bbb” (Good) on
-- “bbb” (Good) on
The following indicative Long-Term IRs have been affirmed with the outlooks revised to negative from stable for the shelf registration:
Kemper Corporation—
-- “bbb” (Good) on senior unsecured debt
-- “bbb-” (Good) on subordinated debt
-- “bb+” (Fair) on preferred stock
The following Long-Term IR has been affirmed, with the outlook revised to negative from stable:
Infinity Property and Casualty Corporation—
-- “bbb” (Good) on
This press release relates to Credit Ratings that have been published on AM 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 AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best's Credit Ratings. For information on the proper use of Best’s Credit Ratings, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.
AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in
Copyright © 2022 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.
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Source: AM Best
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