A.M. Best Co. has affirmed the issuer credit rating (ICR) of “bbb+” and all debt ratings of American Financial Group, Inc. (AFG) [NYSE/NASDAQ: AFG]. Concurrently, A.M. Best has affirmed the financial strength rating (FSR) of A (Excellent) and ICRs of “a+” of Great American Insurance Company and its pooling affiliates (collectively referred to as Great American Insurance Companies or Great American). The outlook for the ratings of AFG and Great American is positive. In addition, A.M. Best has affirmed the FSR of A+ (Superior) and ICRs of “aa” of the property/casualty members of American Empire Surplus Lines Pool (American Empire). A.M. Best also has affirmed the FSR of A (Excellent) and ICRs of “a” of the members of the Republic Indemnity Insurance Pool (Republic Indemnity) (headquartered in Encino, CA). The outlook for the ratings of American Empire and Republic Indemnity is stable. All companies are headquartered in Cincinnati, OH, unless otherwise specified. (Please see link below for a detailed listing of the companies and ratings.)
In addition, A.M. Best has upgraded the FSR to A+ (Superior) from A (Excellent) and the ICRs to “aa-” from “a+” of the property/casualty members of the Mid-Continent Group (Mid-Continent) (headquartered in Tulsa, OK). The outlook has been revised to stable from positive.
The ratings of Great American reflect its excellent risk-adjusted capitalization, strong operating profitability sustained over the long term and diversified business profile. Great American's strong operating performance reflects the profitable underwriting results derived through management's disciplined operating strategy and product knowledge, as well as the group's multiple distribution channels, diversified product offerings, excellent geographic spread of risk and access to data through its sophisticated technology platform. Great American's strong underwriting performance also reflects its modest exposure to natural catastrophes, as demonstrated in recent years with the group reporting relatively low catastrophe-related losses. Lastly, the group also benefits from the financial flexibility provided by its parent, AFG, which maintains financial leverage that is in line with its current ratings, as well as additional liquidity through its access to capital markets and lines of credit. A.M. Best expects that earnings and cash flows from AFG's operating subsidiaries will allow the company to support Great American's capitalization, if needed.
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