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AM Best Upgrades Credit Ratings of Northwest G.F. Mutual Insurance Company
[February 05, 2019]

AM Best Upgrades Credit Ratings of Northwest G.F. Mutual Insurance Company

AM Best has upgraded the Financial Strength Rating to B++ (Good) from B+ (Good) and the Long-Term Issuer Credit Rating to "bbb" from "bbb-" of Northwest G.F. Mutual Insurance Company (NWGF) (Eureka, SD). The outlook of these Credit Ratings (ratings) have been revised to stable from positive.

The ratings reflect NWGF's balance sheet strength, which AM Best categorizes as strong, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management (ERM).

The operating performance assessment, which was revised upward to adequate from marginal, reflects NWGF's clear trend of improved operating return measures over the past five years, including pre-tax return on revenue, return on surplus and operating ratio. These improved operating results have been driven predominantly by improved underwriting performance, particularly incurred losses and loss adjustment expenses. In turn, NWGF's improved operating results have fueled robust growth in policyholders' surplus over the past five years.

The balance sheet assessment of strong reflects risk-adjusted capitalization being at the strongest level and improving underwriting and reserving leverage measures, which are offset by the company's limited financial flexibility and scale of operations. The limited business profile assessment is driven largely by NWGF's geographic concentration in North and South Dakota, which exposes results to frequent and severe wether-related events, as well as potential judicial, economic or regulatory challenges. The appropriate ERM assessment is driven by an evolving risk management framework, and risk management capabilities that remain appropriately commensurate with the complexity of the business.

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 Understanding Best's Credit Ratings. For information on the proper media use of Best's Credit Ratings and AM Best press releases, please view Guide for Media - Proper Use of Best's Credit Ratings and AM Best Rating Action Press Releases.

AM Best is a global rating agency and information provider with a unique focus on the insurance industry. Visit for more information.

Copyright © 2019 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.

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