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AM Best Revises Outlooks to Stable for Members of Oregon Mutual Group

AM Best has revised the outlooks to stable from negative and affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Ratings of "a-" of Oregon Mutual Insurance Company and Western Protectors Insurance Company, which are domiciled in McMinnville, OR and members of the Oregon Mutual Group.

The Credit Ratings (ratings) reflect Oregon Mutual Group’s balance sheet strength, which AM Best categorizes as very strong, as well as its marginal operating performance, neutral business profile and appropriate enterprise risk management.

The revised outlooks to stable reflect AM Best’s expectation for the members of Oregon Mutual Group to maintain very strong balance strength supported by organic surplus growth and favorable reserve development. The balance sheet strength reflects the group’s strongest risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR), somewhat offset by elevated underwriting leverage measures and adverse reserve development in the 2013 and 2014 accident years.

Oregon Mutual Group’s operating performance remains marginal, driven by volatility in underwriting results due to weather events and above-average expenses related to ongoing system conversion costs. While AM Best views the group’s business profile as neutral given its long-standing market presence in the Pacific Northwest, the delays in transitioning to a new policy administration system will challenge results given additional expense and the need for dedicated resources to run parallel systems. Additionally, these delays have limited the use of pricing analytics and ease of doing 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 Guide to 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 credit rating agency, news publisher and data provider specializing in the insurance industry. The company does business in more than 100 countries. Headquartered in Oldwick, NJ, AM Best has offices in cities around the world, including London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.

Copyright © 2020 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.

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Contacts

Steven DeLosa
Financial Analyst
+1 908 439 2200, ext. 5969
steven.delosa@ambest.com

Michelle Baurkot
Director
+1 908 439 2200, ext. 5314
michelle.baurkot@ambest.com

Christopher Sharkey
Manager, Public Relations
+1 908 439 2200, ext. 5159
christopher.sharkey@ambest.com

Jim Peavy
Director, Public Relations
+1 908 439 2200, ext. 5644
james.peavy@ambest.com