Press Release - NOVEMBER 30, 2012

A.M. Best Revises Outlook to Negative for Affinity Mutual Insurance Company

Scott Dodd
Financial Analyst
(908) 439-2200, ext. 5582

Jennifer Marshall
Managing Senior Financial Analyst
(908) 439-2200, ext. 5327

Rachelle Morrow
Senior Manager, Public Relations
(908) 439-2200, ext. 5378

Jim Peavy
Assistant Vice President, Public Relations
(908) 439-2200, ext. 5644


A.M. Best Co. has revised the outlook to negative from stable and affirmed the financial strength rating of A- (Excellent) and issuer credit rating of a- of Affinity Mutual Insurance Company (AMIC) (Lima, OH).

The negative outlook reflects the deterioration in AMIC’s underwriting results during 2011 and through the first three quarters of 2012. The deterioration in underwriting results was primarily driven by increases in incurred losses from weather-related events coupled with AMIC’s historically elevated underwriting expense level and the cumulative impact of persistent soft market conditions on the company’s business.

The affirmation of the ratings reflects AMIC’s solid level of risk-adjusted capitalization, modest underwriting leverage and strong balance sheet liquidity. These positive rating attributes are offset by AMIC’s elevated level of common stock leverage, which results in a heightened exposure to equity market volatility and the aforementioned factors that led to the negative outlook.

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. Key criteria utilized include: “Risk Management and the Rating Process for Insurance Companies” and “Understanding BCAR for Property/Casualty Insurers.” Best’s Credit Rating Methodology can be found at

Founded in 1899, A.M. Best Company is the world’s oldest and most authoritative insurance rating and information source.

Related Companies

For information about each company, including the Best's Credit Reports, group members (where applicable) and news stories, click on the company name. An additional purchase may be required.

AMB# Company Name
004811 Affinity Mutual Insurance Company