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A.M. Best Co. has affirmed the financial strength rating (FSR) of A+ (Superior) and issuer credit ratings (ICR) of “aa-” of
Mercury Casualty Group (Mercury) (Los Angeles, CA) and its members. Additionally, A.M. Best has affirmed the FSR of A- (Excellent) and ICRs of “a-” of
American Mercury Insurance Group (AMI) (Oklahoma City, OK) and its members. Concurrently, A.M. Best has affirmed the ICR of “a-” of Mercury and AMI’s parent,
Mercury General Corporation (Los Angeles, CA) (NYSE: MCY). The outlook for all ratings is stable. (See below for a detailed listing of the companies and ratings.)
Mercury’s ratings reflect its solid risk-adjusted capital position, consistently favorable operating performance and the competitive advantage within its core personal auto segment. Mercury’s capitalization is supported by strong operating returns through profitable underwriting performance and consistent investment income. This is somewhat offset by Mercury’s sizeable shareholder dividends in recent years, which has constrained surplus growth.
Mercury’s competitive advantage in its core personal auto segment is derived through pricing and risk classification expertise, strong independent agency relationships and aggressive claims management practices. Mercury also benefits from the financial flexibility of Mercury General Corporation due to its modest financial leverage and access to capital markets.
AMI’s ratings recognize its adequate level of risk-adjusted capital, improved catastrophe risk management and the demonstrated history of financial support provided by its parent. These positive rating factors are offset by AMI’s elevated underwriting leverage, its relatively high expense structure and continued exposure to catastrophe losses in its operating region.
The FSR of A+ (Superior) and ICRs of “aa-” have been affirmed for
Mercury Casualty Group and its following members:
Mercury Casualty Company
Mercury Insurance Company
California Automobile Insurance Company
Mercury Indemnity Company of Georgia
Mercury Insurance Company of Georgia
Mercury Insurance Company of Illinois
Mercury National Insurance Company
Mercury Insurance Company of Florida
Mercury Indemnity Company of America
The FSR of A- (Excellent) and ICRs of “a-” have been affirmed for
American Mercury Insurance Group and its following members: