Å˽ðÁ«´«Ã½Ó³»­

The AM Best financial rating firm has slightly downgraded the credit rating outlook for two Farm Bureau companies after weather losses and a rise in reinsurance costs and inflation.

The financial strength rating remained at “B++ (Good)” for Georgia Farm Bureau Mutual Å˽ðÁ«´«Ã½Ó³»­ Co. and Georgia Farm Bureau Casualty Å˽ðÁ«´«Ã½Ó³»­ Co., and the group’s balance sheet is strong, AM Best said in a news release Friday. But the long-term issuer credit rating was notched downward, from “positive” to “stable.”

Georgia Farm Bureau Group, based in Macon, has taken steps to improve underwriting results and exposure management, by instituting rate increases, changes in deductibles and tighter underwriting guidelines, “all of which have been effective in improving results from earlier years in the group’s history.”

“However, the revised outlook for the long-term ICR (issuer credit rating) reflects underwriting volatility exhibited by Georgia Farm Bureau in more recent years, driven mainly by an increase in weather-related loss activity, increased reinsurance retention and rising severity because of inflation,” the rating firm said.

The losses led to a higher combined ratio, of 108.3, for 2022 and into 2023. Hurricane Idalia, which struck parts of south Georgia in late August and early September, will also have an impact and will pressure overall net results for the year, AM Best noted.

Related: AM Best Revises US Homeowners Segment to Negative as Losses Persist

Topics Trends Agribusiness AM Best Georgia