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FOR IMMEDIATE RELEASE
OLDWICK, N.J. - DECEMBER 12, 2013 12:00 AM (EST)
A.M. Best Co. has revised the outlook to positive from stable and affirmed the financial strength rating of A (Excellent) and issuer credit ratings of a+ of Vermont Mutual Insurance Company (Vermont Mutual), Northern Security Insurance Company, Inc. (Vermont Mutuals fully reinsured subsidiary) and Granite Mutual Insurance Company (Vermont Mutuals fully reinsured affiliate). These companies are members of Vermont Mutual Group and are domiciled in Montpelier, VT.
The revised outlook reflects Vermont Mutuals favorable underwriting and operating results, which have consistently outperformed the industry composite in recent years. In addition, Vermont Mutual continues to maintain solid risk-adjusted capitalization, a well-established market presence in the New England states and knowledge of local insurance issues.
Offsetting these positive rating factors is Vermont Mutuals business concentration in the New England states, which exposes it to weather-related events and competitive market conditions. However, the company maintains a comprehensive reinsurance coverage program to mitigate potential catastrophe losses.
Key rating drivers that could lead to positive rating actions would be Vermont Mutual producing an operating performance in line with its historically strong results while maintaining its strong risk-adjusted capital position. However, if frequent and severe weather events impact the company's geographical location and/or other market disruptions cause underwriting losses with a substantial negative impact on risk-adjusted capitalization, negative rating actions could ensue.
The methodology used in determining these ratings is Bests Credit Rating Methodology, which provides a comprehensive explanation of A.M. Bests rating process and contains the different rating criteria employed in the rating process.Bests Credit Rating Methodology can be found at www.ambest.com/ratings/methodology.
A.M. Best Company is the worlds oldest and most authoritative insurance rating and information source.