OLDWICK, N.J.--(BUSINESS WIRE)--AM Best has revised the outlooks to positive from stable and affirmed the Financial Strength Rating (FSR) of A- (Excellent) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of “a-” of the members of United Farm Bureau of Indiana Group (Indiana Farm Bureau): United Farm Family Mutual Insurance Company and its wholly owned subsidiary, UFB Casualty Insurance Company.
Concurrently, AM Best has affirmed the FSR of A (Excellent) and the Long-Term ICR of “a” of United Farm Family Life Insurance Company (UFF Life). AM Best also has affirmed the FSR of A- (Excellent) and the Long-Term ICR of “a-” of United Home Life Insurance Company (UH Life). The outlooks of these Credit Ratings (ratings) remain stable. All companies are domiciled in Indianapolis, IN.
The ratings reflect Indiana Farm Bureau’s balance sheet strength, which AM Best categorizes as strongest, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management (ERM).
The ratings of UFF Life reflect its balance sheet strength, which AM Best categorizes as strongest, as well as its adequate operating performance, neutral business profile and appropriate ERM.
The ratings reflect UH Life’s balance sheet strength, which AM Best categorizes as strong, as well as its adequate operating performance, limited business profile, and appropriate ERM.
The revised outlook for Indiana Farm Bureau mainly focuses on management’s ability to stabilize performance in bad weather years despite its product and geographical concentration risk as a single-state writer. While this concentration still exists, management has demonstrated sound risk- and exposure- management initiatives that have led AM Best to consider a higher business profile assessment in future rating cycles.
In earlier years, management implemented a number of underwriting actions following a string of underwriting losses that eroded the group’s capital position. These changes include improved reinsurance, mandatory deductibles and rate revisions. Since the changes were implemented, the underwriting results have been consistently favorable. As a result, the group’s continued improvement in balance sheet strength through stabilized operating trends have helped increase policyholder surplus by nearly 56% over the last five years. AM Best will continue to monitor the rating aspects of the group on an annual basis to determine the appropriate resolution of the positive outlook in future rating cycles.
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