AM Best


A.M. Best Revises Outlook to Positive for Rural Mutual Insurance Company


CONTACTS:

Analyst(s)

Neil DasGupta

(908)439-2200, ext 5206

neil.dasgupta@ambest.com

Gary Davis

(908) 439-2200, ext. 5665

gary.davis@ambest.com
Public Relations

Jim Peavy

(908) 439-2200, ext. 5644

james.peavy@ambest.com

Rachelle Morrow

(908) 439-2200, ext. 5378

rachelle.morrow@ambest.com


FOR IMMEDIATE RELEASE

OLDWICK, N.J. - MAY 01, 2009 12:00 AM (EDT)
A.M. Best Co. has revised the outlook to positive from stable and affirmed the financial strength rating of A- (Excellent) and issuer credit rating of "a-" of Rural Mutual Insurance Company (Rural Mutual) (Madison, WI).

The ratings reflect Rural Mutual's strong capitalization, improved operating performance in recent years and historic local market presence as the leading provider of farm-related insurance coverages in Wisconsin.

These positive rating factors are partially offset by Rural Mutual's historically fluctuating operating results due to its geographic concentration, which exposes its performance to weather-related losses, as well as to potential changes in the regulatory and legislative environment.

The outlook is based on Rural Mutual's improved operating performance in the most recent five-year period despite a generally softening underwriting cycle, due primarily to improvements in underwriting standards along with somewhat milder weather patterns. This favorable operating trend has enabled Rural Mutual to nearly double the level of policyholders' surplus over the last four years and has resulted in solid risk-based capitalization, which strongly supports the current ratings.

For Best's Credit Ratings, an overview of the rating process and rating methodologies, please visit Best's Ratings & Analysis.

The principal methodologies used in determining these ratings, including any additional methodologies and factors that may have been considered, can be found at Best's Credit Rating Methodology.

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.

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AMB# Company Name
002445 Rural Mutual Insurance Company