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AM Best Revises Outlooks to Positive for Michigan Millers Mutual Insurance Company and Affirms Credit Ratings for Western National Insurance Pool Members
[June 11, 2019]

AM Best Revises Outlooks to Positive for Michigan Millers Mutual Insurance Company and Affirms Credit Ratings for Western National Insurance Pool Members


AM Best has revised the outlooks to positive from stable and affirmed the Financial Strength Rating (FSR) of A- (Excellent) and the Long-Term Issuer Credit Rating (Long-Term ICR) of "a-" of Michigan Millers Mutual Insurance Company (Michigan Millers) (Lansing MI).

Concurrently, AM Best has affirmed the FSR of A+ (Superior) and the Long-Term ICRs of "aa-" of Western National Mutual Insurance Company (Edina, MN) and its affiliates, collectively called Western National Insurance Pool (Western National). The outlook of these Credit Ratings (ratings) remains stable. (See below for a detailed listing of companies below).

The ratings of Michigan Miller reflect its balance sheet strength, which AM Best categorizes as very strong, as well as its marginal operating performance, limited business profile and appropriate enterprise risk management (ERM). Michigan Millers' ratings also benefit from support from its affiliation with Western National.

The revised outlooks for Michigan Millers' ratings recognize the improved operating performance in three consecutive years following its affiliation with Western National in 2015. AM Best's assessment of Michigan Millers' operating performance as marginal is a function of the company's historical, long-term performance. However, since its affiliation arrangement, the company reported improved operating earnings in each of the past three years through 2018, primarily driven by sound and growing investment income coupled with profitable underwriting results.

The improved underwriting performance is due largely to significant underwriting initiatives (generated by affiliation arrangement) such as; exiting the personal lines book of business and a managing general agency relationship, freezing the defined pension benefit plan and strengthening of loss reserves, as well as reinsurance protection for its personal lines run-off book of business from Western National.

Additionally, the ratings reflect Michigan Millers' very strong balance sheet strength, based on its strongest level of risk-adjusted capitalization, as measured by Best's Capital Adequacy Ratio (BCAR), conservative investment portfolio, improving liquidity measures and cmprehensive reinsurance program, which is offset partially with the company's limited financial flexibility and scale. The ratings also reflect Michigan Millers' limited business profile, which is due to the limited geographical spread in Michigan and New York, which exposes the company to weather events, as well as potential judicial and regulatory challenges.



The ratings of Western National reflect the group's balance sheet strength, which AM Best categorizes as strongest, as well as its strong operating performance, neutral business profile and appropriate ERM. The group maintains the strongest level of risk-adjusted capitalization, as measured by BCAR, which benefits from stable loss-reserving practices, a prudent investment portfolio and a comprehensive reinsurance program. Strong operating performance is demonstrated with favorable underwriting and operating return measures, which compare favorably with the averages for the private passenger standard auto and homeowners industry composite. Western National is a super-regional carrier with well-diversified geographic representation and product risk spread, as the group underwrites a variety of commercial and personal lines products in 20 states.

The FSR of A+ (Superior) and the Long-Term ICRs of "aa-", each with a stable outlook have been affirmed for the members of Western National Insurance Pool.


  • Western National Mutual Insurance Company
  • Western National Assurance Company
  • Western Home Insurance Company
  • Pioneer Specialty Insurance Company
  • Umialik Insurance Company
  • Arizona Automobile Insurance Company
  • American Freedom Insurance Company
  • Nevada General Insurance Company

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 www.ambest.com for more information.

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


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