Press Release - DECEMBER 05, 2018
AM Best Upgrades Issuer Credit Rating of Bremen Farmers Mutual Insurance Company
FOR IMMEDIATE RELEASE
OLDWICK - DECEMBER 05, 2018
The ratings reflect Bremen’s balance sheet strength, which AM Best categorizes as very strong, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management (ERM).
The upgrade of Bremen’s Long-Term ICR reflects the improvement in its balance sheet strength over the past five years. Bremen has reported favorable operating results over the most recent five years, driven by rate increases and favorable weather activity, resulting in positive underwriting gains and net income. These positive earnings have led to surplus growth, which has reduced leverage measures and improved overall risk-adjusted capitalization.
Bremen’s very strong balance sheet reflects its conservative investment portfolio, favorable reserve development and limited scale of operations. The adequate operating performance reflects the company’s improved underwriting profitability over the most recent five years. Bremen’s five-year average combined ratio has outperformed the personal property composite average. The limited business profile is a reflection of
Bremen’s geographic and product concentrations as a personal property writer in Kansas. ERM is appropriate for Bremen’s size and scope. Bremen has identified its key risks with its main focus being on its exposure concentration. Bremen analyzes these concentrations and performs deterministic stress testing, which it utilizes to limit or reduce business in high concentration areas. Bremen also maintains a comprehensive reinsurance program that protects surplus from frequent and severe weather events.
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 Understanding Best’s Credit Ratings. For information on the proper media use of Best’s Credit Ratings and AM Best press releases, please view Guide for Media - Proper Use of Best’s Credit Ratings and AM Best Rating Action Press Releases.
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