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FOR IMMEDIATE RELEASE
OLDWICK - NOVEMBER 19, 2019 03:50 PM (EST)
AM Best has downgraded the Financial Strength Rating to B++ (Good) from A- (Excellent) and the Long-Term Issuer Credit Rating to “bbb+” from “a-” of Mennonite Aid Plan of the Pacific Coast (Mennonite) (Reedley, CA). The outlook of these Credit Ratings (ratings) has been revised to stable from negative.
The ratings reflect Mennonite’s balance sheet strength, which AM Best categorizes as very strong, as well as its marginal operating performance, limited business profile and appropriate enterprise risk management (ERM).
The rating downgrades are due to Mennonite’s operating performance assessment, which was revised downward to marginal from adequate. This reflects key metrics of total operating return (pre-tax return on revenue, total return on surplus, operating ratio) that lag their respective industry comparison benchmarks on average over the past five years and the longer term.
Mennonite’s balance sheet strength reflects its strongest level of risk-adjusted capitalization, low underwriting leverage measures and high liquidity. AM Best considers Mennonite’s business profile limited due to its focused product market and concentration in its geographic region. AM Best acknowledges the company’s appropriate ERM practices to mitigate its enterprise risk.
This press release relates to Credit Ratings that have been published on AM 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 AM 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 AM Best press releases, please view Guide for Media - Proper Use of Best’s Credit Ratings and AM Best Rating Action Press Releases.
AM Best is a global credit rating agency, news publisher and data provider specializing in the insurance industry. The company does business in more than 100 countries. Headquartered in Oldwick, NJ, AM Best has offices in cities around the world, including London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City.