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FOR IMMEDIATE RELEASE
OLDWICK, N.J. - JUNE 18, 2008 12:00 AM (EDT)
A.M. Best Co. has revised the outlook to stable from negative and affirmed the financial strength rating (FSR) of A- (Excellent) and issuer credit rating of "a-" of Attorneys Liability Protection Society, Inc. A Risk Retention Group (ALPS) (Missoula, MT).
The revised outlook reflects ALPS' enhanced operating performance and strengthened risk-adjusted capitalization. Much of the improvement is attributable to new claims handling, a more conservative approach to setting reserves and stricter underwriting practices that were implemented in 2005 after successive years of adverse prior year reserve development. Prior year loss reserves, which began to stabilize in the latter half 2006, developed favorably in 2007. ALPS also has benefited from management's decision to tighten its underwriting criteria in recent years, which has resulted in rate increases and the non-renewal of unprofitable firms. It is A.M. Best's expectation that operating results will continue to benefit from the aforementioned actions and that risk-adjusted capitalization will continue to strengthen over the near term.
The ratings reflect ALPS' re-focused operating strategies, aggressive claims handling and customer driven management philosophy. ALPS continues to benefit from well-established relationships with State Bar Associations in its principal markets. These relationships serve to assist ALPS in developing local market knowledge and an enhanced ability to anticipate and respond to the needs of attorneys practicing in their respective jurisdictions. As a risk retention group, ALPS is afforded a broad geographic spread with no single state representing more than 20% of its direct premium writings.
Partially offsetting these positive rating factors are ALPS' product concentration risk, past volatility in operating performance and a history of adverse prior year reserve development through 2006.
For Best's Ratings, an overview of the rating process and rating methodologies, please visit Best's Rating Center.
Founded in 1899, A.M. Best Company is a global full-service credit rating organization dedicated to serving the financial and health care service industries, including insurance companies, banks, hospitals and health care system providers.