AM Best Affirms Credit Ratings of NCMIC Group’s Members; Revises Issuer Credit Rating Outlook to Negative

OLDWICK, N.J.--(BUSINESS WIRE)--AM Best has revised the outlook to negative from stable for the Long-Term Issuer Credit Ratings (Long-Term ICR) and affirmed the Financial Strength Rating (FSR) of A (Excellent) and Long-Term ICRs of “a+” (Excellent) of the members of NCMIC Group (NCMIC). The outlook of the FSR is stable. NCMIC consists of NCMIC Insurance Company, Professional Solutions Insurance Company and NCMIC Risk Retention Group, Inc. All companies are headquartered in Clive, IA.

The Credit Ratings (ratings) reflect NCMIC’s balance sheet strength, which AM Best assesses as strongest, as well as its strong operating performance, neutral business profile and appropriate enterprise risk management.

The negative Long-Term ICR outlook reflects the decreasing profitability trends in the group’s underwriting and operating performance in recent years. Underwriting results in earlier years benefited from low claims frequency and severity on the group’s core chiropractic book of business, as well as significant favorable development of prior accident-year loss reserves, which led to an assessment of its operating performance at strong. However, recent efforts to diversify into other professional liability lines and assumed reinsurance has resulted in significant volatility and created a drag on core earnings. Although overall operating results remain profitable, reported results in recent years are more in line with industry averages. AM Best continues to assess NCMIC’s balance sheet strength as strongest, supported by its risk adjusted capitalization at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR). The ratings also acknowledge the group’s dominant market position in the medical professional liability market for chiropractors.

This press release relates to Credit Ratings that have been published on AM 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 AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best’s Credit Ratings. For information on the proper use of Best’s Credit Ratings, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.

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