OLDWICK, N.J.--(BUSINESS WIRE)--A.M. Best has revised the outlooks to negative from stable and affirmed the Financial Strength Rating of C+ (Marginal) and the Long-Term Issuer Credit Rating of “b-” of Country-Wide Insurance Company (Country-Wide) (New York, NY).
The revised outlooks are due to the company’s continued decline in risk-adjusted capitalization as a result of reserve strengthening efforts. Country-Wide’s most recent drop in surplus was driven by a considerable increase to all accident year reserves in an effort to eliminate its on-going adverse reserve development trends. In addition, Country-Wide’s underwriting and loss reserve leverage measures are well in excess of the private passenger non-standard automobile composite.
Partially offsetting these negative rating factors is the company’s substantial other income which in some years, combined with net investment income, is able to offset underwriting losses and allows the company to maintain competitive rates. Country-Wide does have a long-standing presence in its operating territory with a diverse employee force speaking 22 languages and has utilized forms in five different languages. Additionally, the company is heavily invested in technology, which streamlines underwriting and claims processes, and helps to mitigate fraud.
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