Best’s News & Research Service - April 05, 2018 11:06 AM (EDT)
A.M. Best Upgrades Issuer Credit Rating of Kentucky Growers Insurance Company
- April 05, 2018 11:06 AM (EDT)
Oldwick //BestWire// - A.M. Best has upgraded the Long-Term Issuer Credit Rating to “bbb+” from “bbb” and affirmed the Financial Strength Rating of B++ (Good) of Kentucky Growers Insurance Company (KGIC) (Lexington, KY). The outlook of these Credit Ratings (ratings) is stable.
The ratings reflect KGIC’s balance sheet strength, which A.M. Best categorizes as very strong, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management.
The rating actions reflect KGIC’s considerable improvement in operating performance over the past five years, driven by its consistently positive underwriting results. Growth in policyholders’ surplus has been reported in each of the past five years, attributable primarily to underwriting gains.
The ratings also reflect the KGIC’s very strong balance sheet, driven by its risk-adjusted capitalization being at the strongest level, low loss reserve leverage, comprehensive reinsurance program with strong partners and strong liquidity measures enhanced by positive operating and underwriting cash flows. These positive rating attributes are offset somewhat by KGIC’s limited financial flexibility and scale. Additionally, KGIC’s business profile is limited by its single-state concentration in Kentucky, which exposes results to frequent and severe weather-related events, as well as potential judicial, economic, competitive or regulatory challenges.
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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