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FOR IMMEDIATE RELEASE
OLDWICK - SEPTEMBER 25, 2014 09:34 AM (EDT)
A.M. Best has affirmed the financial strength rating of A+ (Superior) and issuer credit ratings of 'aa" of Factory Mutual Insurance Company and its subsidiaries, Appalachian Insurance Company and Affiliated FM Insurance Company. The outlook for all ratings is stable. All companies are members of FM Global Group and domiciled in Johnston, RI.
The ratings reflect FM Global Group members' superior level of risk-adjusted capitalization, historically strong operating performance, its leadership position in the commercial property market and the benefits gained from its advanced approach to loss prevention and property conservation.
These positive rating factors are partially offset by FM Global Group's significant exposure and susceptibility to natural and man-made catastrophes. In addition, the group maintains elevated common stock leverage which while manageable, adds some volatility to its overall balance sheet and earnings.
FM Global Group is a market leader among providers of commercial property insurance in the United States, serving a significant number of Fortune 1000 companies worldwide, many of which have been with the FM Global Group for more than 25 years. The group's ability to consistently retain more than 90% of its policyholders is a result of its stable capacity, unique level of engineering resources, international reach, loss prevention technology and shared commitment to property preservation.
While the ratings for FM Global Group's members are stable, future positive rating actions may result from their continued strong underwriting and operating performance. However, negative rating actions could result should the group's underwriting and operating performance fall markedly short of A.M. Best's expectations or if there is a significant weakening of its overall risk-adjusted capitalization.
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.
A.M. Best Company is the world's oldest and most authoritative insurance rating and information source.