|[April 02, 2014]
A.M. Best Upgrades Ratings of Hartland Mutual Insurance Company
OLDWICK, N.J. --(Business Wire)--
A.M. Best has upgraded the financial strength rating (FSR) to B+
(Good) from B (Fair) and the issuer credit rating (ICR) to "bbb-" from
"bb+" of Hartland Mutual Insurance Company (Hartland Mutual)
(Minot, ND). The outlook for the ICR has been revised to stable from
negative, while the outlook for the FSR remains stable.
The rating upgrades for Hartland Mutual are reflective of the
significant improvement in its risk-adjusted capitalization and earnings
performance in recent years. In addition, the company has strengthened
its underwriting guidelines and lowered its retention on its property
catastrophe reinsurance treaty, which is expected to favorably impact
earnings going forward.
These positive ratings factors are partially offset by the company's
concentration in personal lines homeowners and farmowners coverages in
North Dakota. This concentration exposes Hartland Mutual to severe
weather conditions as well as potential changes in he regulatory,
legislative and judicial environments in the state. In addition,
competitive market conditions are strong and most business is placed
through the independent agent channel. These concerns are partially
mitigated by routine property inspections on both new and renewal
business, Hartland Mutual's long-standing presence in North Dakota and
acquisition of several agencies to improve sales, claims handling and
Positive rating actions may occur if Hartland Mutual continues its
favorable earnings performance. Negative rating actions may occur
following a sudden and unexpected decrease in the company's
capitalization, an unfavorable earnings trend or a significant
diminution of balance sheet liquidity.
The methodology used in determining these ratings is Best's Credit
Rating Methodology, which provides a comprehensive explanation of A.M.
Best's rating process and contains the different rating criteria
employed in the rating process. Best's Credit Rating Methodology can be
found at www.ambest.com/ratings/methodology.
A.M. Best Company is the world's oldest and most authoritative
insurance rating and information source. For more information, visit www.ambest.com.
Copyright © 2014 by A.M. Best Company, Inc. ALL RIGHTS
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