AM Best has affirmed the Financial Strength Rating of A and the Long-Term Issuer Credit Ratings of a+ of American Family Mutual Insurance Company, S.I. and its core affiliates. In addition, AM Best has affirmed the Long-Term Issue Credit Rating (Long-Term IR) of “a-” (Excellent) of the $70 million, 7.25%, 20-year surplus notes of NGM Insurance Company (Jacksonville, FL), an American Family affiliate. Concurrently, AM Best has affirmed the FSR of A (Excellent) and the Long-Term ICR of “a+” (Excellent) of American Family Life Insurance Company (AFLIC) (Madison, WI). The outlook of these Credit Ratings (ratings) is stable. (See below for a detailed listing of the companies and Credit Ratings [ratings].)
The ratings of American Family reflect its balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, favorable business profile and appropriate enterprise risk management (ERM).
The ratings of AFLIC reflect its balance sheet strength, which AM Best assesses as strongest, as well as its adequate operating performance, neutral business profile and appropriate ERM.
The ratings are supported by American Family’s risk-adjusted capitalization, which AM Best considers to be at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR). Operating performance reflects stronger underwriting results year over year and consistent investment income. The company is addressing challenging economic trends through significant rate and other underwriting actions while maintaining a focus on profitable growth in its core segments. In addition to improved underwriting results, the sale of Permanent General Assurance Corporation, Permanent General Assurance Corporation of Ohio and The General Automobile Insurance Company, Inc., commonly referred to as The General, closed in the fourth quarter of 2024, and significantly improved capital levels and provided financial flexibility for ongoing strategic initiatives. American Family is a multistate, multiline writer. Its product mix, distribution channels and geographic mix have become more focused through mergers, acquisitions and disposition activity over the past decade, which further supports the business profile assessment.
AFLIC’s risk-adjusted capitalization remains at the strongest level, as measured by BCAR, even with significant dividends to American Family in recent years. AFLIC has shown consistent profitability on operating and net income levels. American Family remains committed to support its life insurance operations, which provide diversification and a stream of earnings.
Continuation of the stable outlooks for AFLIC primarily reflects the improvement at American Family and the strong association between the property/casualty and life operations. AFLIC currently receives lift from the lead rating unit; therefore, a change in American Family’s ratings or outlooks may have a corresponding effect on ALFIC’s ratings or outlooks.
The FSR of A (Excellent) and the Long-Term ICRs of “a+” (Excellent) have been affirmed, with stable outlooks, for the following affiliates of American Family Mutual Insurance Company, S.I.:
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