OLDWICK, N.J.--(BUSINESS WIRE)--A.M. Best has upgraded the financial strength rating (FSR) to B++ (Good) from B+ (Good) and the issuer credit rating (ICR) to “bbb” from “bbb-” of Hartland Mutual Insurance Company (Hartland Mutual ) (Minot, ND). The outlooks on the FSR and ICR have been revised to stable from positive.
The upgrade is a result of Hartland Mutual’s strengthened risk-adjusted capitalization and positive trend in operating performance over the past five years. The company’s focus on maintaining rate adequacy and increased deductibles has assisted Hartland Mutual in exceeding management’s projections of the past few years and is anticipated to continue. Also, the company’s surplus appreciation has exceeded premium growth, resulting in favorable underwriting leverage measures.
Partially offsetting these positive factors is the company’s geographic concentration of property business in North Dakota. Business is written statewide; however, severe or frequent weather-related events have the ability to affect operating performance as evidenced in prior year’s results. In addition, competitive market conditions are strong and most business is placed through the independent agent channel, which could expose the company to adverse risk selection due to the company’s somewhat limited scale. However, management adheres to strict underwriting guidelines and has implemented numerous corrective actions to safeguard against this exposure.
Positive rating action may continue following sustained favorable operating performance and by maintaining strong risk-adjusted capitalization along with positive underwriting cash flow. Negative rating action could occur following a sudden and unexpected material decrease in capitalization or an unfavorable earnings trend or operating performance.
This press release relates to rating(s) 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 Recent Rating Activity web page.
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