AM Best revises issuer credit rating outlook to negative for Cameron Mutual Insurance Company
OLDWICK, New Jersey – (COMMERCIAL THREAD) –AM Best revised the outlook for the long-term issuer credit rating (long-term ICR) from stable to negative and confirmed the financial strength rating (FSR) of B (Fair) and the long-term ICR of “Bb +” (Fair) from Cameron Mutual Insurance Company (Cameron Mutual) (Cameron, MO). The outlook for the FSR is stable.
Credit ratings reflect the strength of Cameron Mutual’s balance sheet, which AM Best considers strong, as well as its marginal operational performance, limited business profile and marginal enterprise risk management (ERM).
The revised long-term ICR outlook to negative reflects the continued erosion of surplus due to large underwriting losses weighing on the overall strength of Cameron Mutual’s balance sheet. The long-term outlook for the ICR also takes into account measures of underwriting leverage, which nearly double the standard composite of cars and owners for private passengers and the recent unfavorable development trend of the reserve for private passengers. sinister. Cameron Mutual’s marginal operating performance reflects annual underwriting losses, due to weather-related losses and the increased frequency and severity of auto insurance, as well as an above-average expense ratio due to investments in information technology and higher commissions. The limited business profile reflects the Company’s geographic focus in the Midwest region and its exposure to losses from extreme weather conditions. AM Best considers Cameron Mutual’s ERM to be marginal because the program has not been shown to be effective in limiting losses and achieving expected results.
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