OLDWICK, N.J.--(BUSINESS WIRE)--AM Best has upgraded the Long-Term Issuer Credit Rating (Long-Term ICR) to “bbb+” (Good) from “bbb” (Good) and affirmed the Financial Strength Rating of B+ (Good) of Mt. Morris Mutual Insurance Company (Mt. Morris) (Coloma, WI). The outlook of these Credit Ratings (ratings) is stable.
The ratings reflect Mt. Morris’ balance sheet strength, which AM Best assesses as strong, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management.
The upgrade of the Long-Term ICR reflects the company’s strengthened balance sheet, inferred by key metrics of financial strength over the past five years with those over the longer term. Improved operating performance has powered robust policyholders’ surplus growth over the past five years, which in turn pushes important quantitative metrics such as underwriting and reserve leverages in a favorable direction. AM Best attributes these trends to company management’s efforts to implement quality underwriting initiatives in order to broadly improve operating performance, the result of which has been a favorable influence on overall balance sheet strength. Mt. Morris has maintained the strongest level of risk-adjusted capitalization over the past five years, as measured by Best’s Capital Adequacy Ratio (BCAR), which further corroborates the tangible impact of the company’s improved operating performance on its balance sheet strength.
The limited business profile assessment is driven largely by Mt. Morris’ geographic concentration in Wisconsin, which exposes results to frequent and severe weather-related events, as well as potential judicial, economic or regulatory challenges. The appropriate ERM assessment is driven by a developed risk management framework, and risk management capabilities that remain appropriately commensurate with the complexity of the business.
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