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FOR IMMEDIATE RELEASE
OLDWICK - JULY 03, 2024 01:10 PM (EDT)
AM Best has affirmed the Financial Strength Rating (FSR) of A (Excellent) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of “a” (Excellent) of the members of Farmers Insurance Group (Farmers). At the same time, AM Best has affirmed the Long-Term Issue Credit Ratings (Long-Term IR) of “bbb+” (Good) on the outstanding surplus notes of Farmers Insurance Exchange (Woodland Hills, CA) and Farmers Exchange Capital (Wilmington, DE). The outlook of these Credit Ratings (ratings) is stable. (Please see below for a detailed listing of the companies and ratings.)
The ratings of Farmers reflect its balance sheet strength, which AM Best assesses as strong, as well as its adequate operating performance, favorable business profile and appropriate enterprise risk management.
The overall assessment of the group’s balance sheet strength reflects its stable loss reserve position, conservative investment portfolio and comprehensive reinsurance program. Additionally, the ratings reflect Farmers’ adequate operating performance, which remains in line with peers despite elevated catastrophe losses in 2023. Management has implemented considerable measures to enhance its underwriting performance through targeted pricing actions and risk-mitigation strategies, revised product offerings and stronger underwriting oversight. Partially offsetting these strengths is Farmers’ high exposure to catastrophe losses and reliance on approximately $1.75 billion of surplus notes.
The FSR of A (Excellent) and the Long-Term ICRs of “a” (Excellent) have been affirmed with stable outlooks for the following members of Farmers Insurance Group:
The following Long-Term IRs have been affirmed with stable outlooks:
Farmers Insurance Exchange—
- “bbb+” (Good) on USD 400 million 4.747% surplus notes, due 2057
Farmers Exchange Capital—
- “bbb+” (Good) on USD 500 million 7.05% surplus notes, due 2028 (USD 375.0 million outstanding)
- “bbb+” (Good) on USD 150 million 7.2% surplus notes, due 2048 (USD 138.5 million outstanding)
- “bbb+” (Good) on USD 335 million 6.151% surplus notes, due 2053
- “bbb+” (Good) on USD 500 million 5.454% surplus notes, due 2054
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.