OLDWICK, N.J.--(BUSINESS WIRE)--A.M. Best has revised the outlooks to negative from stable and affirmed the Financial Strength Rating (FSR) of B+ (Good) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of “bbb-” of Georgia Farm Bureau Mutual Insurance Company and Georgia Farm Bureau Casualty Insurance Company, collectively referred to as the Georgia Farm Bureau Group (Georgia Farm Bureau). All companies are domiciled in Macon, GA.
The negative outlooks reflect Georgia Farm Bureau’s decline in overall risk-adjusted capitalization, continued adverse operating results in 2017, increase in financial leverage and elevated exposure to the equity markets. The negative outlooks further consider the challenging investment climate for equities and fixed income, characterized by peak, yet volatile stock prices and low bond yields. In addition, the group’s geographic concentration exposes it to regulatory and legislative actions that may have a material impact on its business strategies.
Prospectively, the company’s ongoing initiatives to improve performance include enhanced reinsurance coverage, additional support to the company’s capital structure via surplus notes, efforts to improve reserving adequacy and expansion of the company’s senior management team. Furthermore, Georgia Farm Bureau maintains a cost-effective employee agency network, a long-standing local market presence, and derives benefits from the sponsorship provided by the Georgia Farm Bureau Federation, which facilitate marketing and government relations efforts and enhances customer loyalty and affinity.
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