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A.M. Best Upgrades Issuer Credit Ratings of Members of Central Insurance Companies

May 14, 2018

OLDWICK, N.J.--(BUSINESS WIRE)--May 14, 2018--A.M. Best has upgraded the Long-Term Issuer Credit Ratings (Long-Term ICR) to “a+” from “a” and affirmed the Financial Strength Rating (FSR) of A (Excellent) of Central Mutual Insurance Company and All America Insurance Company, which are collectively referred to as Central Insurance Companies (Central). Both companies are domiciled in Van Wert, OH. The outlook of the Long-Term ICRs have been revised to stable from positive, while the outlook of the FSR remains stable.

The Credit Ratings (ratings) reflect Central’s balance sheet strength, which A.M. Best categorizes as strongest, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management. The rating actions reflect improved and stabilized underwriting performance over the most recent five-year period through 2017 as a result of significant underwriting initiatives, including rate adequacy. Net underwriting gains were supplemented with net investment income in each of the past five years, as opposed to net underwriting losses generated in the prior five-year period. Historically, Central has been impacted by weather-related losses; however, the implementation of several personal lines and commercial lines underwriting initiatives helped combat weather-related losses. Additionally, Central has a comprehensive reinsurance program that helps shield the balance sheet from large catastrophe events. As a result, a combined ratio below break-even has been generated in each of the past five years, which compare favorably with industry averages.

Central’s balance sheet strength is supported by the strongest level of risk-adjusted capitalization, favorable loss reserving trends, a prudent investment portfolio and strong liquidity measures. Surplus growth is vigorous and has averaged 10% on a five-year compound average basis, largely driven by improved underwriting results, strong investment earnings, and capital gains (realized and unrealized). The companies operate across the United States, licensed in 37 states with premium written in 23 of those states through the use of independent agents and four regional offices. Central offers a broad array of personal and commercial products including homeowners, private passenger auto liability and commercial multi-peril lines, to name a few.

This press release relates to Credit Ratings that have been published on A.M. 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 A.M. Best’s web page. For additional information regarding the use and limitations of Credit Rating opinions, please view . For information on the proper media use of Best’s Credit Ratings and A.M. Best press releases, please view .

A.M. Best is the world’s oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com.

Copyright © 2018 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.

View source version on businesswire.com:https://www.businesswire.com/news/home/20180514006306/en/

CONTACT: A.M. Best

Kim Muccia, +1 908-439-2200, ext. 5731

Financial Analyst

kimberly.muccia@ambest.com

or

Christopher Sharkey, +1 908-439-2200, ext. 5159

Manager, Public Relations

christopher.sharkey@ambest.com

or

Brian O’Larte, +1 908-439-2200, ext. 5138

Director

brian.o’larte@ambest.com

or

Jim Peavy, +1 908-439-2200, ext. 5644

Director, Public Relations

james.peavy@ambest.com

KEYWORD: UNITED STATES EUROPE NORTH AMERICA NEW JERSEY

INDUSTRY KEYWORD: PROFESSIONAL SERVICES FINANCE

SOURCE: A.M. Best

Copyright Business Wire 2018.

PUB: 05/14/2018 03:47 PM/DISC: 05/14/2018 03:48 PM

http://www.businesswire.com/news/home/20180514006306/en

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