Best’s News & Research Service - August 21, 2025 01:16 PM (EDT)
AM Best Revises Outlooks to Stable for Core Members of Southern Farm Bureau Casualty Group; Removes From Under Review With Positive Implications and Upgrades Credit Ratings of Arkansas Farm Bureau Insurance Company
- August 21, 2025 01:16 PM (EDT)
//BestWire// - AM Best has revised the outlooks to stable from negative and affirmed the Financial Strength Rating (FSR) of A (Excellent) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of “a” (Excellent) of Southern Farm Bureau Casualty Insurance Company, Colorado Farm Bureau Insurance Company (Colorado Farm Bureau) (both of Ridgeland, MS), Louisiana Farm Bureau Casualty Insurance Company (Baton Rouge, LA) and Mississippi Farm Bureau Casualty Insurance Company (Jackson, MS). In addition, AM Best has removed from under review with positive implications and upgraded the FSR to A (Excellent) from B (Fair) and the Long-Term ICR to “a” (Excellent) from “bb” (Fair) of Arkansas Farm Bureau Insurance Company (Ridgeland, MS), formally Farm Bureau Mutual Insurance Company of Arkansas, Inc. The outlook assigned to these Credit Ratings (ratings) is stable. These companies are collectively referred to as Southern Farm Bureau Casualty Group (Southern Farm Bureau).
The ratings reflect Southern Farm Bureau’s balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management.
The revised outlooks reflect Southern Farm Bureau’s improved operating performance through 2024, and continued through year-to-date 2025. Results earlier in this five-year period were volatile, driven predominately by unfavorable trends in the auto market and increased catastrophe activity, which management addressed through sizable rate increases and adjustments to its underwriting criteria. These actions led to improved rate adequacy and better selection of risks, which precipitated an underwriting profit and a combined ratio of 95.9% in 2024–over a 20-point improvement from the prior year. This trend of profitability has continued through year-to-date 2025, despite ongoing losses due to weather-related events, demonstrating that Southern Farm Bureau’s results remain in-alignment with its adequate operating performance assessment.
The rating upgrades for Arkansas Farm Bureau Insurance Company reflect its 100% reinsurance quota share agreement with Southern Farm Bureau Casualty Insurance Company (Southern Casualty), which was successfully executed effective August 1, 2025. On that same date, Farm Bureau Mutual Insurance Company of Arkansas, Inc. demutualized and converted to a stock company, which was renamed Arkansas Farm Bureau Insurance Company (Arkansas Farm Bureau), and Southern Casualty purchased all the stock of this newly formed company. Arkansas Farm Bureau is now a wholly owned subsidiary of Southern Casualty, and cedes 100% of all premiums, losses, and expenses to Southern Casualty. For Arkansas Farm Bureau, this transaction brings significant financial advantages and the ability to achieve cost savings through sharing and centralizing operational functions, and for Southern Farm Bureau, it better aligns with its overall strategic goals and purposes, as well as provides linkage to a larger policyholders’ surplus base.
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 Guide to Best's Credit Ratings. For information on the proper use of Best’s Credit Ratings, Best’s Performance Assessments, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.
AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City.