AM Best Revises Outlooks to Positive for Members of Encova Mutual Insurance Group

OLDWICK, N.J.--(BUSINESS WIRE)--AM Best has revised to 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-” (Excellent) for the members of Encova Mutual Insurance Group (Encova). Concurrently, AM Best has affirmed the FSR of A- (Excellent) and the Long-Term ICR of “a-” (Excellent) of Encova Life Insurance Company (Encova Life) (Columbus, OH). The outlook of these Credit Ratings (ratings) is stable. (See below for a detailed listing of companies and ratings).

The ratings reflect Encova’s balance sheet strength, which AM Best assesses as strongest, as well as its marginal operating performance, neutral business profile and appropriate enterprise risk management (ERM).

The revised outlooks reflect Encova’s continued improvement in underwriting and operating performance in recent years. The group has implemented a new strategy following one-time charges and reserve strengthening related to the 2017 merger. AM Best expects continued favorable operating performance trends that could support positive rating action.

The ratings are supported by the group’s risk-adjusted capitalization at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR), as well as the overall strength of its balance sheet, reflecting management’s commitment to surplus preservation and growth. Solid investment income continues to drive the company’s operating performance, as underwriting results improve and continue to return to more-favorable historical norms. Encova is a multistate, multiline writer with some geographic concentration. Its product mix is well-diversified with workers’ compensation as the largest line of business.

The ratings of Encova Life reflect its balance sheet, which AM Best assesses as very strong, as well as its adequate operating performance, limited business profile and appropriate ERM.

The FSR of A- (Excellent) and the Long-Term ICR of “a-” (Excellent) have been affirmed, with the outlooks revised to positive from stable for the following members of Encova Mutual Insurance Group:

• AlleghenyPoint Insurance Company
• BrickStreet Mutual Insurance Company
• Consumers Insurance USA, Inc.
• Iowa American Insurance Company
• Iowa Mutual Insurance Company
• MICO Insurance Company
• Motorists Commercial Mutual Insurance Company
• Motorists Mutual Insurance Company
• NorthStone Insurance Company
• Phenix Mutual Fire Insurance Company
• PinnaclePoint Insurance Company
• SummitPoint Insurance Company
• Wilson Mutual 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 Guide to Best’s Credit Ratings. For information on the proper use of Best’s Credit Ratings, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.

AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.

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