AM Best Affirms Credit Ratings of MLMIC Insurance Company
December 9, 2020by
AM Best has affirmed the Financial Strength Rating (FSR) of A+ (Superior) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of “aa-” of MLMIC Insurance Co. The outlook of these Credit Ratings (ratings) is stable.
The ratings reflect MLMIC’s balance sheet strength, which AM Best categorizes as strongest, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management. The ratings also benefit from the financial support provided by MLMIC’s direct parent company, National Indemnity Co., which is ultimately owned by Berkshire Hathaway Inc.
MLMIC has a long track record of favorable reserve development and adequate underwriting returns. In recent years, net operating results have been somewhat skewed by a 100% loss portfolio transfer to National Indemnity Co. in 2018. As such, the company’s net underwriting results in the most recent years do not benefit from the reserve releases related to prior years. The direct underwriting results remain in line with historical trends, and further support the current operating performance assessment.
MLMIC’s insurance portfolio is concentrated in the medical malpractice line of business. The company underwrites risks only within New York state, which is one of the nation’s most challenging markets for medical professional liability. However, management has been able to operate successfully through underwriting cycles while maintaining MLMIC’s leading market position within New York. In addition, risk management capabilities have proven appropriate for the risk profile of the company.