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FOR IMMEDIATE RELEASE
OLDWICK - FEBRUARY 13, 2015 12:27 PM (EST)
A.M. Best has revised the outlook to positive from stable and affirmed the financial strength rating of A- (Excellent) and the issuer credit ratings of "a-" of Medical Mutual Liability Insurance Society of Maryland (Medical Mutual) (Hunt Valley, MD) and its wholly owned subsidiary, Professionals Advocate Insurance Company (ProAd) (Hunt Valley, MD). These companies are collectively referred to as Medical Mutual Group (MD) (MMG) or the group.
The positive outlook reflects MMG's consistently strong underwriting income, as demonstrated by a very favorable five-year average pre-dividend combined ratio. The group's excellent overall profitability has been maintained across multiple time periods. The group also has consistently improved its risk-adjusted capital position. In addition, the positive outlook considers MMG's consistent reserve adequacy and its dedicated risk management and loss prevention programs for their members.
Partially offsetting the positive rating factors is the group's position as single line writer of medical professional liability, which is subject to price competition, tort-reform, and variable loss frequency and severity trends. Nonetheless, Medical Mutual and ProAd have established themselves as consistently strong performers within their jurisdictions.
Factors that may lead to positive rating actions include a continuation of MMG's strong underwriting and operating performance in the near term, while maintaining strong capitalization. Factors that may lead to a downgrade include a disruption in market dynamics, changes in tort reform legislation, shifting claim severity and frequency trends, or adverse trends in reserve development resulting in a significant weakening of the group's risk-adjusted capitalization or a trend of unfavorable operating performance.
The methodology used in determining these ratings is Best's Credit Rating Methodology, which provides a comprehensive explanation of A.M. Best's rating process and contains the different rating criteria employed in the rating process. Best's Credit Rating Methodology can be found at www.ambest.com/ratings/methodology.
Key insurance criteria reports utilized:
This press release relates to rating(s) 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 visit A.M. Best's Ratings & Criteria Center .
A.M. Best Company is the world's oldest and most authoritative insurance rating and information source.