OLDWICK, N.J.--(BUSINESS WIRE)--A.M. Best has assigned a Financial Strength Rating (FSR) of A (Excellent) and a Long-Term Issuer Credit Rating (Long-Term ICR) of “a+” to Farmers Union Mutual Insurance Company (AR) (Bryant, AR) (FUMIC AR). The outlook assigned to these Credit Ratings (ratings) is stable. Concurrently, A.M. Best has affirmed the FSR of A (Excellent) and the Long-Term ICR of “a+” of Farmers Union Mutual Insurance Company (ND) (FUMIC ND) (Jamestown, ND). The outlook of these ratings is stable.
FUMIC AR is a mutual insurance company that has been in operation since 1934 writing homeowners in Arkansas.
The ratings reflect the strategic alliance with FUMIC ND and the material support that FUMIC AR receives in the form of a pooling agreement. The ratings also consider the synergies provided by FUMIC ND via an affiliation agreement and a cost sharing and management agreement, under which FUMIC AR receives management and marketing support necessary to impact its economic performance.
The ratings also reflect a consolidated view of FUMIC AR’s and FUMIC ND’s balance sheet strength, which A.M. Best categorizes as strongest, as well as their strong operating performance, neutral business profile and appropriate enterprise risk management.
Profitability is driven by favorable underwriting results and positive net income that has been reported in each of the past five years. Management continuously sets forth initiatives to maintain profitability. The addition of FUMIC AR will help to offset the geographic concentration in North Dakota, as the two states experience different weather patterns.
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 Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Understanding Best’s Credit Ratings. For information on the proper media use of Best’s Credit Ratings and A.M. Best press releases, please view Guide for Media - Proper Use of Best’s Credit Ratings and A.M. Best Rating Action Press Releases.
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