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AM BEST'S MONTHLY INSURANCE MAGAZINE



Standing the Test of Time
Standing the Test of Time - 2021 Edition

In 2020, 68 property/casualty insurance companies and 18 life/health carriers had maintained a Best’s Financial Strength Rating of A or higher for at least 75 years. Special Section sponsored by Finys.
  • Lori Chordas
  • July 2021
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As the pandemic drove large losses across the insurance industry and caused many companies' financials to plummet last year, Farm Bureau Property & Casualty Insurance Co. and Sun Life Assurance Company of Canada continued to stand the test of time, joining 84 other insurers who have maintained a Best's Financial Strength Rating of A or higher for at least 75 years.

They were among the 68 property/casualty and 18 life/health insurers to make the annual list compiled by AM Best.

Farm Bureau Property & Casualty's net income last year more than doubled to $253 million from $113 million in 2019, according to AM Best. The company's combined ratio improved to 91.7 from 95.6 in the prior year, and its admitted assets grew to $3.1 billion while net premiums, the company reports, rose $150 million to $1.45 billion.

Sun Life Assurance, too, proved that what was a financially taxing 2020 for many was anything but that for the company. Despite a slight drop in net income, last year Sun Life's assets climbed to nearly $254 billion and net premiums earned rose slightly to $16 billion, the company reports.

Farm Bureau Property & Casualty, based in Des Moines, Iowa, was founded in 1939 as the Iowa Farm Mutual Insurance Co. to meet the unique liability insurance needs of farmers. Eighty-two years later, more than one-quarter of its business remains in farmowners insurance, with written direct premiums in the line surpassing $331 million last year, AM Best reports.

When the company opened its doors in the late 1930s, it had roughly 3,300 auto insurance policies on its books, many with liability limits of 5/10/5 for bodily injury or property damage, along with comprehensive and $10 deductible collision coverages. Today, property/casualty member accounts in force top 362,000.

In 1948, Farm Bureau Property & Casualty expanded into crop hail insurance and formed Iowa Mutual Hail Insurance Co., before merging with Iowa Farm Bureau Mutual in 1957. The following year, the company shed its moniker to become Farm Bureau Mutual Insurance Co. and merged with Minnesota Farm Bureau Mutual. Policies at that time were issued exclusively to members, but in 1968 the company expanded its offering of general casualty, homeowners, personal auto, fire and allied coverages to associate members as well.

Coverages like those were put to the test in 1967 when Farm Bureau suffered two of its largest single losses to date—a $45,500 claim paid for hail damage and destruction of corn and bean crops, and a tornado loss of $95,000 paid to a member who lost his home, farm buildings and machinery.

In addition to its long history of organic growth, the company has grown in other ways over the years. In 1999 it merged with South Dakota Farm Bureau Mutual Insurance and just three years later purchased Western Farm Bureau Mutual and Utah Farm Bureau Mutual. Then in 2003, Farm Bureau Mutual merged with Farm Bureau Mutual Insurance Company Inc. of Kansas and Farm Bureau Insurance Company of Nebraska. Last year, Farm Bureau purchased the minority shares of Western Agricultural Insurance Co., and now owns all of the company's outstanding common stock.

In 2010, Farm Bureau Mutual Insurance Co. was reorganized and renamed under the name it still holds today, Farm Bureau Property & Casualty Insurance Co.

Another Debut

Sun Life Assurance Company of Canada was founded in 1865 in Canada by Irish immigrant Mathew Hamilton Gault as The Sun Insurance Company of Montreal. Over the years, the company expanded into areas such as the United States, India and the U.K., and underwent several name changes until landing on its current moniker in 1882.

Global challenges such as wars and pandemics didn't halt Sun Life Assurance's growth plans or keep the company from giving aid to its policyholders and staff impacted by those events. During World War I, 171 of its employees took to the battlefield, each receiving full pay from the company's board of directors during their military service. Around the same time, Sun Life paid out more than $2.1 million in claims related to the 1918 influenza pandemic. Then in the 1930s, during the Great Depression, the company paid an average of $16.5 million annually to par policyholders, and continued its groundwork for new growth when conditions improved on the heels of the worldwide economic crisis.

Last year Sun Life Assurance, along with its parent, Sun Life Financial Inc., once again assisted policyholders faced by adversity. In addition to expediting claims, the companies offered free debt consolidation plans, deferred insurance payments, extended coverage, waived waiting periods and provided virtual care to insureds during COVID-19.

In 1962, the company organized as a mutual life insurance company but decided to demutualize around the turn of the 21st century.

In 2013, Sun Life completed a definitive stock purchase sale of its U.S. annuities business and certain U.S. life insurance businesses, including all of the issued and outstanding shares of Sun Life (U.S.). Its U.S. annuity business at that time included domestic U.S. variable annuity, fixed annuity and fixed indexed annuity products, corporate and bank-owned life insurance products and variable life products, according to AM Best.

A Feather in Their Cap

In addition to recognizing companies that have attained an A or higher Best's Financial Strength Rating for at least 75 years, Standing the Test of Time lists property/casualty and life/health companies that have held the rating for at least a half-century.

On the property/casualty side, 58 companies were part of this group, while another 17 life/health companies kept their A or higher rating intact for 50 years or more.

Last year, five property/casualty insurers joined those ranks for the first time: AIU Insurance Co., American Modern Home Insurance, St. Paul Guardian Insurance Co., West Bend Mutual Insurance, and Western World Insurance.

Some companies have even reached a higher level of distinction. Property/casualty insurers Federal Insurance Co., Hartford Fire Insurance Co. and New Hampshire Insurance Co. have maintained an A or higher rating for 114 consecutive years.

On the life/health side, Principal Life Insurance Co. and Penn Mutual Life Insurance Co. maintained their A or higher rating from AM Best for 94 successive years.

A Long Tradition

For 115 years, AM Best has been issuing Financial Strength Ratings or opinions on the ability of individual insurers to pay claims on the coverage they have underwritten.

To identify the companies with the longest record of consistent financial strength, Best's analysts pored over the rating agency's proprietary data—primarily Best's Key Rating Guides and Best's Insurance Reports—to accumulate and verify ratings and other pertinent data dating to 1905.

AM Best's Rating Scale has changed over time in an ongoing effort to increasingly distinguish the relative financial strength of insurers and adapt to changes in the insurance industry.

Therefore, in certain circumstances it was necessary to translate or convert older ratings to conform to the present rating scale. These translations do not represent any material change or reevaluation of a company's rating; they are merely a conversion from one scale to another.

The original rating system, implemented in 1906, was devised by the company's founder, Alfred M. Best.

In 1921 a new rating scale, General Policyholder Ratings, replaced the previously used Desirability Ratings, which applied only to property/casualty insurers.

Desirability Ratings consisted of two components: a loss-paying record, ranked on an alphabetical scale with “A” being the best; and a rating of management quality on a numeric scale with “1” being the best.

An Evolving Process

The rating scale adopted in 1932 had two components: the New Resource Rating, the forerunner of today's Financial Size Category; and the General Policyholders Rating, which evolved into today's Financial Strength Ratings.

From 1935 to 1975, AM Best did not assign letter ratings to life/health companies. Instead they had “comments.”

In order to complete this rating history project, a translation was devised to convert the comments to equivalent letter ratings. For example, from 1935 to 1952, “More than Ample” was found to be equivalent to today's A rating.

Property/Casualty Insurers Rated A or Higher for 75 Years

AMB# Company Name First
Year
Rated
A or
Better
Since
A or Better
Consecutive
Years
Rating
000354 Farm Bureau Prop & Cas Ins Co 1946 1946 75 A
003263 Swiss Reinsurance America Corp 1945 1945 76 A+
002034 American Home Assurance Co 1906 1944 77 A
002086 Vigilant Insurance Company 1943 1943 78 A++
002131 Transportation Insurance Co 1941 1941 80 A
000348 Erie Insurance Exchange 1928 1939 82 A+
002022 American Family Mutual Ins Co 1931 1939 82 A
002178 Associated Indemnity Corp 1926 1939 82 A+
002276 Economy Fire & Casualty Co 1922 1939 82 A
002477 State Farm Fire & Casualty Co 1939 1939 82 A++
002357 Nationwide Mutual Fire Ins Co 1938 1938 83 A+
002182 National Surety Corporation 1922 1937 84 A+
002361 Illinois National Insurance Co 1926 1937 84 A
003152 Otsego Mutual Fire Ins Co 1926 1938 84 A+
000700 New York Central Mutual Fire 1925 1936 85 A
002359 21st Century Pacific Ins Co 1922 1936 85 A
000974 Western Surety Company 1922 1935 86 A
002054 Cambridge Mutual Fire Ins Co 1923 1935 86 A
002035 Insurance Co of the State PA 1907 1934 87 A
002177 American Insurance Company 1907 1934 87 A+
002351 National Union Fire Ins Co PA 1907 1934 87 A
002381 Ohio Farmers Insurance Co 1911 1935 87 A
000384 Federated Mutual Insurance Co 1920 1934 88 A+
000694 New Jersey Manufacturers Ins 1922 1934 88 A+
002176 American Automobile Ins Co 1915 1933 88 A+
002382 Westfield Insurance Company 1930 1934 88 A
003260 Mutual Assurance Society of VA 1922 1933 88 A
000558 Lititz Mutual Insurance Co 1932 1932 89 A
002249 COUNTRY Mutual Insurance Co 1931 1931 90 A+
000826 Selective Ins Co of America 1930 1930 91 A
002229 Hartford Casualty Ins Co 1930 1930 91 A+
002287 American States Insurance Co 1930 1930 91 A
002358 Nationwide Mutual Ins Co 1929 1929 92 A+
002446 First National Ins Co of Amer 1929 1929 92 A
002479 State Farm Mutual Auto Ins Co 1927 1929 92 A++
002349 AIG Property Casualty Company 1907 1928 93 A
002385 Pacific Indemnity Company 1928 1928 93 A++
000228 CSAA Insurance Exchange 1927 1927 94 A
000918 Tri-State Ins Co of Minnesota 1927 1927 94 A+
002198 General Reinsurance Corp 1925 1928 94 A++
000934 United Services Auto Assn 1927 1927 95 A++
002232 Hartford Underwriters Ins Co 1926 1926 95 A+
002447 General Ins Co of America 1926 1926 95 A
002452 St. Paul Fire & Marine Ins Co 1926 1926 95 A++
000662 Montgomery Mutual Ins Co 1922 1925 96 A
002360 Granite State Insurance Co 1907 1925 96 A
002179 Fireman's Fund Insurance Co 1918 1924 97 A+
000149 Munich Reinsurance America Inc 1922 1923 98 A+
000414 Germantown Mutual Ins Co 1922 1923 98 A
002085 Great Northern Insurance Co 1923 1923 98 A++
000320 Pharmacists Mutual Ins Co 1922 1922 99 A
000347 Westport Insurance Corp 1922 1922 99 A+
000371 Farmers Mutual Ins Co of NE 1922 1922 99 A
000387 Fidelity and Deposit Co of MD 1922 1922 99 A+
000465 Hartford Steam Boiler I & I 1922 1922 99 A++
000796 Quincy Mutual Fire Ins Co 1922 1922 99 A+
002097 Euler Hermes NA Insurance Co 1922 1922 99 A+
002128 Continental Casualty Company 1922 1922 99 A
002230 Hartford Accident & Indem Co 1922 1922 99 A+
002394 Peerless Insurance Company 1922 1922 99 A
002162 Amica Mutual Insurance Co 1922 1922 100 A+
002235 Twin City Fire Insurance Co 1916 1921 100 A+
002055 Merrimack Mutual Fire Ins Co 1920 1920 101 A
002129 Natl Fire Ins Co of Hartford 1907 1914 107 A
002213 Great American Insurance Co 1908 1908 113 A+
002084 Federal Insurance Company 1907 1907 114 A++
002231 Hartford Fire Insurance Co 1907 1907 114 A+
002363 New Hampshire Insurance Co 1907 1907 114 A

Source: AM Best data and research. Ratings as of April 27, 2021

Property/Casualty Insurers Rated A or Higher for 50 Years

AMB# Company Name First
Year
Rated
A or
Better
Since
Consecutive Years
Rated A or Better
Rating
000964 West Bend Mutual Ins Co 1922 1971 50 A
002389 AIU Insurance Company 1906 1971 50 A
003031 American Modern Home Ins Co 1971 1971 50 A+
003132 Western World Insurance Co 1970 1971 50 A
004311 St. Paul Guardian Ins Co 1971 1971 50 A++
002251 Indiana Farmers Mutual Ins 1933 1969 52 A
004049 USAA Casualty Insurance Co 1970 1970 52 A++
000188 Auto-Owners Insurance Co 1922 1968 53 A++
000422 Grange Insurance Company 1940 1968 53 A
000900 Hawkeye-Security Insurance Co 1967 1968 53 A
002065 American Commerce Insurance Co 1951 1968 53 A
002453 St. Paul Mercury Insurance Co 1968 1968 53 A++
004043 Westfield National Ins Co 1969 1969 53 A
002023 Amer Standard Ins Co of WI 1967 1967 54 A
002407 Progressive Casualty Ins Co 1960 1967 54 A+
003030 Hiscox Insurance Company Inc 1958 1967 54 A
003521 Great American Alliance Ins Co 1950 1967 54 A+
000595 Mercury Casualty Company 1967 1967 55 A
002186 America First Insurance Co 1966 1966 55 A
002350 Lexington Insurance Company 1966 1966 55 A
002542 Inland Insurance Company 1965 1966 56 A
000708 North Carolina Farm Bureau Mut 1958 1963 59 A
000860 Pioneer State Mutual Ins Co 1962 1962 59 A+
002050 Standard Guaranty Ins Co 1962 1962 59 A
002284 Lightning Rod Mutual Ins Co 1962 1962 59 A
002476 State Farm County Mut of Texas 1961 1961 60 A++
000464 Hastings Mutual Insurance Co 1928 1961 61 A
002014 AMCO Insurance Company 1960 1960 61 A+
002285 Western Reserve Mutual Cas 1955 1960 61 A
002286 American Economy Insurance Co 1960 1960 61 A
002540 Mount Vernon Fire Ins Co 1960 1960 61 A++
004000 Commerce and Industry Ins Co 1958 1958 63 A
000594 Merchants Bonding Co (Mutual) 1953 1958 64 A
003073 Generali USB 1957 1957 64 A
002053 Bay State Insurance Company 1956 1956 65 A
002290 Amer States Ins Co of Texas 1956 1956 65 A
002323 Midwestern Indemnity Company 1956 1956 65 A
002297 Universal Underwriters Ins Co 1955 1955 66 A+
002448 Safeco Ins Co of America 1955 1955 66 A
002541 United States Liability Ins Co 1922 1955 66 A++
000258 Cincinnati Insurance Company 1955 1955 67 A+
000886 Tennessee Farmers Mut Ins Co 1953 1954 67 A+
002428 National Fire & Marine Ins Co 1954 1954 67 A++
000714 North Star Mutual Ins Co 1953 1953 68 A+
002005 Alfa Mutual Insurance Company 1953 1953 68 A
002429 National Indemnity Company 1947 1953 68 A++
002049 American Security Insurance Co 1950 1952 69 A
000259 Church Mutual Ins Co, S.I. 1950 1951 70 A
000971 Continental Western Ins Co 1918 1951 70 A+
002004 Great American Assurance Co 1908 1951 70 A+
002532 Union Insurance Company 1921 1951 70 A+
002543 Universal Surety Company 1952 1952 70 A
002132 Valley Forge Insurance Co 1948 1950 71 A
000203 Barnstable County Mut Ins Co 1922 1949 72 A
002127 American Cas Co of Reading, PA 1922 1949 72 A
002210 Great Amer Ins Co of New York 1918 1949 72 A+
002393 Netherlands Insurance Co 1906 1949 72 A
000540 Kentucky Farm Bureau Mutual 1949 1949 73 A

Source: AM Best data and research. Ratings as of April 27, 2021

Life/Health Insurers Rated A or Higher for 75 Years

AMB# Company Name First
Year
Rated
A or
Better
Since
Consecutive
Years Rated
A or Better
Rating
006493 Canada Life Assurance Company 1928 1945 76 A+
007101 Sun Life Assur Co of Canada 1928 1946 76 A+
006087 American National Insurance Co 1928 1941 80 A
006724 Minnesota Life Insurance Co 1928 1940 81 A+
006962 Protective Life Insurance Co 1928 1940 81 A+
006664 Lincoln National Life Ins Co 1928 1940 82 A+
006688 Manufacturers Life Ins Co 1928 1939 82 A+
006695 Massachusetts Mutual Life Ins 1928 1939 82 A++
006244 Columbus Life Insurance Co 1928 1938 83 A+
006294 COUNTRY Life Insurance Company 1933 1933 88 A+
006704 Metropolitan Life Ins Co 1928 1928 93 A+
006820 New York Life Insurance Co 1928 1928 93 A++
006845 Northwestern Mutual Life Ins 1928 1928 93 A++
006974 Prudential Ins Co of America 1928 1928 93 A+
007069 Standard Insurance Company 1928 1928 93 A
007243 Western & Southern Life Ins Co 1928 1928 93 A+
006150 Principal Life Insurance Co 1928 1928 94 A+
006903 Penn Mutual Life Insurance Co 1928 1928 94 A+

Source: AM Best data and research. Ratings as of April 27, 2021

Life/Health Insurers Rated A or Higher for 50 Years

AMB# Company Name First
Year
Rated
A or Better
Since
Consecutive
Years Rated
A or Better
Rating
006617 Lafayette Life Insurance Co 1928 1970 51 A+
007053 Southern Farm Bureau Life Ins 1952 1970 51 A+
006827 North American Co for L&H Ins 1922 1969 52 A+
006058 American General Life Ins Co 1928 1968 53 A
006852 Ohio National Life Ins Co 1928 1964 57 A
007112 Teachers Ins & Annuity Assn 1928 1964 57 A++
006468 Banner Life Insurance Company 1955 1963 58 A+
007168 United Farm Family Life Ins Co 1950 1961 60 A
006885 Pacific Life Insurance Company 1928 1959 62 A+
007192 United States Life Ins in NY 1928 1959 62 A
006629 Liberty National Life Ins Co 1934 1958 63 A
007164 United of Omaha Life Ins Co 1931 1956 66 A+
006812 Nationwide Life Ins Co 1935 1954 67 A+
007080 State Farm Life Insurance Co 1934 1954 67 A++
006605 Kansas City Life Insurance Co 1928 1952 69 A
006109 American United Life Ins Co 1936 1950 71 A+
006508 Guardian Life Ins Co of Amer 1928 1947 74 A++

Source: AM Best data and research. Ratings as of April 27, 2021

Best's Ratings

The Rating History Project is based on Best's Financial Strength Ratings. A Best's Financial Strength Rating is an independent opinion of an insurer's financial strength and ability to meet its ongoing insurance policy and contract obligations. The rating is based on a comprehensive quantitative and qualitative evaluation of a company's balance sheet strength, operating performance and business profile.

AM Best was founded in 1899 with the purpose of performing a constructive and objective role in the insurance industry toward the prevention and detection of insurer insolvency. This mission led to the development of Best's Ratings, which are now recognized worldwide as the benchmark of assessing insurers' financial strength. Best's Ratings' opinions reflect an in-depth understanding of business fundamentals garnered for more than 100 years of focusing solely on the insurance industry. This is one reason why insurance industry professionals have consistently ranked Best's Ratings No. 1 in confidence, usefulness and understanding.

A Best's Rating is an independent third-party evaluation that subjects all insurers to the same rigorous criteria, providing a valuable benchmark for comparing insurers, regardless of their country of domicile. Such a benchmark is increasingly important to an international market that looks for a strong indication of stability in the face of widespread deregulation, mergers, acquisitions and other dynamic factors.


BestMark for Rated Insurers

AM Best rated insurers can showcase their Best's Credit Rating by displaying their BestMark, a well-known icon customized with their assigned level of financial strength, in marketing materials. A BestMark shows the financial industry, agents, brokers, customers, prospects and consumers verification of their financial strength, and that the insurer has undergone AM Best's rigorous rating process.

A company's BestMark can be featured in both traditional and digital marketing materials: websites, print ads, brochures, web banner ads, social media, email signatures, business cards, and conference and events materials. It is available in four colors—black, blue, gold and white—to complement the style and design of a company's marketing materials.

Insurers can provide permission for its agents and/or brokers to use their BestMark once the rated company has provided approval to AM Best via bestmarkinsurers@ambest.com.

BestMark logo in black
BestMark logo in gold
BestMark logo in blue

Lori Chordas is a senior associate editor. She can be reached at lori.chordas@ambest.com.


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