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 A (Excellent) and the Long-Term ICRs of “a” of Grinnell Mutual Reinsurance Co. and its subsidiary Grinnell Select Insurance Co.
Both are headquartered in Grinnell, Iowa, and are collectively referred to as Grinnell Mutual Group (Grinnell).
The outlook of the FSR remains stable.
The ratings reflect Grinnell’s balance sheet strength, which A.M. Best categorizes as strongest, as well as its marginal operating performance, neutral business profile and appropriate enterprise risk management. The positive outlook reflects the group’s improved operating performance in recent years due to significant improvement in underwriting practices on the assumed book of business. Strong underwriting income and steady net investment income has contributed to the healthy surplus growth of the past five years.
However, Grinnell’s policyholder surplus remains susceptible to natural catastrophes due to geographic concentration within its property lines business.
Grinnell maintains a well-established market position as a leading reinsurer of farm mutual insurers in the Midwest region of the United States. The relationship with the farm mutual insurers creates a strategic advantage for Grinnell, allowing it to penetrate the small towns and rural areas in its operating territory.
Source: A.M. Best
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