A.M. Best Co. has upgraded the financial strength rating to B- (Fair) from C++ (Marginal) of American Community Mutual Insurance Company (Livonia, Mich.). The rating outlook is positive.
The rating action reflects American Community’s improving operating
results, increased capital and surplus position, its expense reduction
efforts and technological advancements.
American Community has reportedly taken a number of corrective actions to return to underwriting profitability, which included implementing significant rate increases, tightening underwriting restrictions and redesigning its product portfolio to more accurately price the risks being written. These actions have enabled the company’s surplus position to more than triple over the past two years.
While American Community has made good progress in improving its
financial stability, A.M. Best continues to note its exposure to the
volatile individual and small group major medical markets and the
increasingly difficult regulatory environment.
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