OLDWICK, N.J.--(BUSINESS WIRE)--AM Best has revised the outlooks to stable from negative and affirmed the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Rating of “a” (Excellent) of NAMIC Insurance Company, Inc. (NAMICO) (Indianapolis, IN).
The Credit Ratings (ratings) reflect NAMICO’s balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management (ERM).
The revised outlooks to stable from negative reflect a trend of improving underwriting and operating performance in recent years, attributable to a number of management initiatives, which resulted in improved operating profits in each of the past two years. Additionally, the revised outlooks reflect improvement in NAMICO’s claims management process in response to previous reserve increases and subsequent refiling of the annual statement in 2019. Mitigation efforts including detailed claims reviews, additional claims staffing and increased usage of data analytics that have subsequently relieved pressure on the company’s ERM assessment.
AM Best’s balance sheet strength assessment of very strong is supported by NAMICO’s risk-adjusted capitalization being at the strongest level, measured by Best’s Capital Adequacy Ratio (BCAR), along with positive growth in policyholders’ surplus over the past five years that was offset partially by limitations in its financial flexibility and scale of operations. NAMICO’s neutral business profile assessment is driven largely by its strong niche market in the mutual insurer segment coupled with the company’s favorable geographic diversification.
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