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FOR IMMEDIATE RELEASE
OLDWICK - AUGUST 14, 2017 03:25 PM (EDT)
A.M. Best has upgraded the Financial Strength Rating to B+ (Good) from B (Fair) and the Long-Term Issuer Credit Rating to “bbb-” from “bb+” of Midrox Insurance Company (Midrox) (Roxbury, NY). The outlooks of these Credit Ratings (ratings) have been revised to stable from positive.
The rating upgrades are based on the company’s continuing solid level of risk-adjusted capitalization coupled with steady surplus growth, and underwriting and operating results which have improved to become more in line with its peer group. Although underwriting performance has fluctuated, pre-tax operating profits have been reported in four of the past five years, including 2016, as well as five-year averages that are comparable to the personal property composite. Additionally, the balance sheet remains strong as demonstrated with surplus that has nearly doubled over the past 10 years, sound liquidity measures, redundant loss reserve development and a quality investment portfolio. Surplus growth continued through second quarter 2017 and although surplus is relatively small, the company maintains a comprehensive reinsurance program to mitigate volatility to surplus from severe weather-related losses.
These positive rating factors are partially offset by Midrox’s concentration of risk in New York which can expose results to weather-related events, as well as regulatory and judicial challenges, an elevated expense ratio primarily driven by the commission expense ratio and high common stock leverage when compared to the composite average.
This press release relates to Credit Ratings that have been published on A.M. 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 A.M. Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Understanding Best’s Credit Ratings. For information on the proper media use of Best’s Credit Ratings and A.M. Best press releases, please view Guide for Media - Proper Use of Best’s Credit Ratings and A.M. Best Rating Action Press Releases.
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