JUNE 23, 2008 12:00 AM (EDT)
A.M. Best Upgrades Ratings of Bankers Insurance Group and Its Members
(908) 439-2200, ext. 5621
Jeffrey Mango, CPA
(908) 439-2200, ext. 5204
(908) 439-2200, ext. 5644
(908) 439-2200, ext. 5378
FOR IMMEDIATE RELEASE
OLDWICK, N.J. - JUNE 23, 2008 12:00 AM (EDT)
A.M. Best Co. has upgraded the financial strength rating (FSR) to B+ (Good) from B (Fair) and issuer credit rating (ICR) to "bbb-" from "bb+" of Bankers Insurance Group (Group) and its member, Bankers Insurance Company. Concurrently, A.M. Best has upgraded the FSR to B+ (Good) from B (Fair) and the ICR to "bbb-" from "bb" of First Community Insurance Company. This company, which previously had been separately rated, has been added to the Group.
In addition, A.M. Best has affirmed the FSR of B (Fair) and ICR of "bb" of the Group's separately rated life/health affiliate, Bankers Life Insurance Company. The outlook for all ratings is stable. All entities are located in St. Petersburg, FL.
The rating actions on the Group reflect its improved risk-adjusted capitalization, expertise in the homeowners and small commercial niches and underwriting enhancements, which have led to improved underwriting performance in recent years. These positive rating factors are somewhat offset by historical variability in surplus and underwriting performance, elevated underwriting expense ratios and susceptibility to frequent and severe weather-related events due to the Group's exposure in the Florida marketplace.
The ratings of Bankers Life recognize its operating losses from new business strain in the annuity market and the company's weak risk-adjusted capitalization. Partially offsetting these factors is the potential improvement in earnings performance in the annuity marketplace through a combination of good surrender charge protection and new business production.
For Best's Ratings, an overview of the rating process and rating methodologies, please visit Best's Rating Center.
Founded in 1899, A.M. Best Company is a global full-service credit rating organization dedicated to serving the financial and health care service industries, including insurance companies, banks, hospitals and health care system providers. For more information, visit www.ambest.com.