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A.M. Best Removes from Under Review and Upgrades Issuer Credit Ratings of Meadowbrook Insurance Group, Inc.’s Subsidiaries


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Susan Molineux
Senior Financial Analyst
(908) 439-2200, ext. 5829
susan.molineux@ambest.com

Henry Witmer
Assistant Vice President
(908) 439-2200, ext. 5097
henry.witmer@ambest.com
Christopher Sharkey
Manager, Public Relations
(908) 439-2200, ext. 5159
christopher.sharkey@ambest.com

Jim Peavy
Assistant Vice President, Public Relations
(908) 439-2200, ext. 5644
james.peavy@ambest.com

FOR IMMEDIATE RELEASE

OLDWICK - NOVEMBER 19, 2015 02:32 PM (EST)
A.M. Best has removed from under review with positive implications and upgraded the issuer credit ratings (ICR) to “bbb+” from “bbb” and also affirmed the financial strength rating (FSR) of B++ (Good) for the operating subsidiaries of Meadowbrook Insurance Group, Inc. (MIGI) (Southfield, MI), which operate under an intercompany reinsurance pooling agreement. The outlook assigned to the ratings is stable. Concurrently, A.M. Best has withdrawn the ICR of “bb” of MIGI as it is no longer a publicly traded company and does not have public debt. Collectively, the operating subsidiaries are referred to as Meadowbrook Insurance Group (Meadowbrook). (See below for a listing of the companies.)

The rating actions follow the completion of the sale of MIGI to Fosun International Limited (Fosun) [HKEx stock code: 00656] on July 7, 2015. Following the close of the transaction, Fosun funded the extinguishment of approximately $100.0 million in outstanding debt of MIGI. In addition, MIGI was delisted and has become an intermediate holding company owned by Fosun. The company continues to operate under the Meadowbrook brand name.

The ratings reflect Meadowbrook’s adequate capitalization and improved operating results following significant adverse loss reserve development in calendar years 2012 and 2013. The latter has largely been addressed by securing an adverse development cover for reserves at Dec. 31, 2014.

Further, since 2013, management has strengthened reserves through the addition of a risk margin. These positive factors are partially offset by the need to demonstrate the long-term execution of the group’s business plan by management. A.M. Best has observed that operating results have shown improvement since 2013, and will continue to monitor operating results of the group. Sustained, favorable long-term operating performance remains a key rating factor going forward.

Factors that could lead to positive rating actions would be the continued trend of improving operating profitability which contributes to the group’s risk-adjusted capital levels. Factors that could lead to an outlook revision or a rating downgrade include unfavorable operating profitability trends, outsized underwriting or investment losses and a decline in risk-adjusted capital that would not be supportive of the current rating levels.

The ICRs have been upgraded to “bbb+” from “bbb” and the FSRs of B++ (Good) have been affirmed for the following subsidiaries of Meadowbrook Insurance Group, Inc.:


  • Star Insurance Company

  • Century Surety Company

  • Savers Property and Casualty Insurance Company

  • ProCentury Insurance Company

  • Williamsburg National Insurance Company

  • Ameritrust Insurance Corporation

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.

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