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FOR IMMEDIATE RELEASE
OLDWICK - OCTOBER 24, 2014 03:12 PM (EDT)
A.M. Best has placed under review with negative implications the financial strength rating of A- (Excellent) and the issuer credit rating of "a-" of Allied Professionals Insurance Company, A Risk Retention Group, Inc. (APIC) (Scottsdale, AZ).
This rating action reflects A.M. Best's concerns with the decline in risk-adjusted capitalization caused by advancement in reserve positions from deteriorating loss experience in the chiropractic specialty along with growth in the overall premium base. Company management has presented several remedial actions to reverse the negative claims trend and strengthen capitalization. Nonetheless, there is a degree of execution risk involved with the implementation of APIC's plan of improvement and uncertainty regarding the overall impact these actions will have upon the company's balance sheet and income statement in 2014 and 2015. The ratings will remain under review pending the implementation of the company's action plan and completion of A.M. Best's analysis on how these initiatives impact APIC's risk-adjusted capitalization and financial performance in the near and mid-term.
The methodology used in determining these ratings is Best's Credit Rating Methodology, which provides a comprehensive explanation of A.M. Best's rating process and contains the different rating criteria employed in the rating process. Best's Credit Rating Methodology can be found at www.ambest.com/ratings/methodology.
Key insurance criteria reports utilized:
A.M. Best Company is the world's oldest and most authoritative insurance rating and information source.