AM Best Places Credit Ratings of Wolverine Mutual Insurance Company Under Review With Positive Implications

OLDWICK, N.J.--(BUSINESS WIRE)--AM Best has placed under review with positive implications the Financial Strength Rating of C++ (Marginal) and the Long-Term Issuer Credit Rating (Long-Term ICR) of “b” (Marginal) of Wolverine Mutual Insurance Company (Wolverine) (Dowagiac, MI).

The Credit Ratings (ratings) reflect Wolverine’s balance sheet strength, which AM Best assesses as weak, as well as its marginal operating performance, limited business profile and marginal enterprise risk management.

These rating actions follow the announcement that Wolverine and Clover Financial Corporation (Clover) have signed and filed a sponsored demutualization transaction with the Michigan Department of Insurance and Financial Services. In this transaction, Wolverine will convert into a stock company and Clover will purchase the entire stock of the newly formed company, at which point Wolverine will become a wholly owned subsidiary of Clover.

The under review with positive implications status reflects the opportunity for improved balance sheet metrics and operating performance for Wolverine, if it becomes a subsidiary of Clover. Clover’s parent company, Oakland Financial Corporation, currently owns Cherokee Insurance Company (Cherokee), which maintains a Long-Term ICR of “a” (Excellent) with a stable outlook. Cherokee and Wolverine entered a 25% quota share agreement on all personal lines of business, effective Jan.1, 2025. Cherokee is a leading auto lines writer in Michigan with sufficient financial flexibility and strong underwriting guidelines.

AM Best expects that subsequent to regulatory approvals and customary closing conditions, the transaction is anticipated to close in the second quarter of 2025. The ratings will remain under review with positive implications pending the completion of the transaction and until AM Best can appropriately evaluate Clover’s plan for Wolverine.

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 Performance Assessments, 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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