OLDWICK, N.J.--(BUSINESS WIRE)--A.M. Best has revised the outlooks to positive from stable and affirmed the financial strength rating of B+ (Good) and the issuer credit rating of “bbb-” for Mt. Morris Mutual Insurance Company (MMIC) (Coloma, WI).
The ratings and outlooks reflect MMIC’s improved risk-adjusted capitalization, strengthened policyholder surplus and operating income. The ratings also reflect the company’s improving operating performance in recent years, which resulted from a steady stream of investment income that buttressed overall underwriting profitability. MMIC’s earnings over the latest five-year period also benefited from capital gains, a long-standing local market presence and strong agency relationships. The positive outlooks reflect A.M. Best’s expectation that operating earnings will remain positive and lead to further strengthening of overall risk-adjusted capitalization.
Management has taken several actions to improve underwriting results, including rate level adjustments, exposure mitigation activities, more refined underwriting techniques and agency management changes. Partly offsetting these positive rating factors are the company’s elevated underwriting and investment leverage, limited product diversification and geographic concentration of risks in Wisconsin. This single-state concentration exposes the company to competitive market conditions, frequent and severe weather-related events and potential judicial and regulatory actions.
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