CONTACTS:
FOR IMMEDIATE RELEASE
OLDWICK, N.J. - JULY 31, 2007 12:00 AM (EDT)
A.M. Best Co. has affirmed the financial strength rating (FSR) of A- (Excellent) and assigned issuer credit ratings (ICR) of "a-" to MAG Mutual Group (MAG Mutual) (Atlanta, GA) and its members. The outlook for the FSR has been revised to stable from negative, and the outlook assigned to the ICR is stable.
The ratings reflect MAG Mutual's improved capitalization, continued operating profitability, favorable loss reserve development and its leadership position in providing professional liability coverage for healthcare providers in its core state of Georgia, as well as contiguous states in the Southeast. The ratings also consider the level of earnings MAG Mutual reported in recent years, its full year earnings prospects for 2007, along with the additional $30 million surplus note that was issued by MAG Mutual Insurance Company in first quarter 2007.
These positive attributes are offset by the group's product concentration of risk and growth in underwriting exposures experienced in the earlier years of the recent five-year period. Management addressed the growth issue by raising additional capital in 2003 and again in 2007.
The revised outlook reflects the expectation of continued favorable earnings, management's commitment to price adequacy and prudent loss reserve practices and the ability of MAG Mutual to maintain a level of risk-adjusted capitalization that is commensurate with its current ratings.
The FSR of A- (Excellent) has been affirmed and the ICRs of "a-" have been assigned to MAG Mutual Group and its following members:
- MAG Mutual Insurance Company
- Professional Security Insurance Company
Founded in 1899, A.M. Best Company is a full-service credit rating organization dedicated to serving the financial services industries, including the banking and insurance sectors. For more information, visit www.ambest.com.