AM Best Revises Mississippi Farm Bureau Outlooks to Negative

AM Best has revised the outlooks to negative from stable and affirmed the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Rating of “a” (Excellent) of Mississippi Farm Bureau Casualty Insurance Company of Jackson, Miss.

AM Best said the credit ratings reflect Mississippi Farm Bureau’s balance sheet strength, which AM Best assesses as very strong, as well as its strong operating performance, limited business profile and appropriate enterprise risk management.

The ratings from said the outlook revisions are in response to adverse trends in the group’s underwriting performance from 2019 through year-to-date 2021. “The company’s volatile results have pressured profitability metrics and are trending unfavorably when compared against writers with operating performance assessments of strong,” AM Best said.

According to AM Best, the group’s adverse performance has been driven by increased frequency of weather events across its territories.

The company has taken steps to improve performance, specifically by writing more business in its northern territories that are less exposed to coastal catastrophic storms, as well as implementing rate increases and lowering operating expenses.

Looking ahead, AM Best said the resolution of the negative outlook “will be determined by the company’s ability to mitigate weather losses, stabilize operating results and revert the combined ratio to pre-2018 levels .”

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