Press Release - DECEMBER 14, 2017

A.M. Best Downgrades Issuer Credit Rating of Affinity Mutual Insurance Company


CONTACTS:
 Christopher Jackson
Financial Analyst
+1 908 439 2200, ext. 5721
christopher.jackson@ambest.com

Brian O’Larte
Associate Director
+1 908 439 2200, ext. 5138
brian.o’larte@ambest.com

Christopher Sharkey
Manager, Public Relations
+1 908 439 2200, ext. 5159
christopher.sharkey@ambest.com

Jim Peavy
Director, Public Relations
+1 908 439 2200, ext. 5644
james.peavy@ambest.com

FOR IMMEDIATE RELEASE

OLDWICK - DECEMBER 14, 2017
A.M. Best has downgraded the Long-Term Issuer Credit Rating (Long-Term ICR) to “bbb” from “bbb+” and affirmed the Financial Strength Rating (FSR) of B++ (Good) of Affinity Mutual Insurance Company (AMIC) (Lima, OH). The outlook of the Long-Term ICR has been revised to stable from negative, while the FSR outlook remains stable.

The ratings reflect AMIC’s balance sheet strength, which A.M. Best categorizes as very strong, as well as its marginal operating performance, limited business profile and appropriate enterprise risk management.

The rating actions reflect the volatility in AMIC’s underwriting and operating performance over the past five years, most significantly in 2012, 2014, and 2015. The company’s underwriting results were impacted by weather-related events and fire losses, coupled with a historically elevated underwriting expense structure. The rating actions also reflect AMIC’s risk-adjusted capitalization being at the strongest level, low underwriting leverage and strong balance sheet liquidity. These positive rating attributes are offset somewhat by AMIC’s exposure to weather-related events due to geographic concentration of risk, as well as high product risk of the business it typically writes.

This press release relates to Credit Ratings 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 see A.M. Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Understanding Best’s Credit Ratings. For information on the proper media use of Best’s Credit Ratings and A.M. Best press releases, please view Guide for Media - Proper Use of Best’s Credit Ratings and A.M. Best Rating Action Press Releases.

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AMB# Company Name
004811 Affinity Mutual Insurance Company