A.M. Best has revised the outlook to positive from stable for the Long-Term Issuer Credit Rating (Long-Term ICR) and affirmed the Financial Strength Rating (FSR) of B++ (Good) and the Long-Term ICR of “bbb” of Wolverine Mutual Insurance Co. (Wolverine), in Dowagiac, Mich.
The outlook of the FSR remains stable.
The positive outlook on the Long-Term ICR reflects the company’s strengthening risk-adjusted capitalization and underwriting initiatives of the past several years resulting in a favorable trend in Wolverine’s operating performance.
The company’s capital position is derived from its modest investment leverage and consistently favorable loss reserve development combined with overall surplus increases in excess of net writings. Improved underwriting results are attributable to management’s efforts in re-underwriting and re-inspecting its property lines and focusing efforts on automobile fraud and fighting excessive medical billing claims.
Furthermore, while elevated when compared to the private passenger standard automobile and homeowners’ composite, expenses continue to diminish as the company leverages technological advantages.
Partially offsetting these positive rating factors is Wolverine’s geographic concentration in Michigan. Surplus is exposed to frequent and severe weather events as exhibited in recent years, as well as the judicial and regulatory environment; most notable is automobile personal injury protection coverage, which is a challenge for all companies with this exposure in Michigan.
Source: A.M. Best
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