Cover Story
75
S
50
Fifty-five property/casualty insurers and 14 life/health
insurers have maintained a Best’s Financial Strength Rating
of A or higher for at least 75 years.
ince 1906, A.M. Best Co. has been issuing financial strength ratings—opinions on the ability of
individual insurance companies to pay claims on
the coverage they have underwritten.
These financial strength ratings evolved over the
decades as the insurance industry grew more complex. A
select group of insurers has consistently maintained strong
financial strength ratings for the past 75 years despite catastrophic storms and tough economic times.
26
Best’s Review • july 2009
The property/casualty and life
insurance companies that have
maintained a Best’s financial
strength rating of A or higher
for at least 75 years are recognized here, as are the insurers
that have maintained a similar
record of financial strength for
at least 50 years. Additionally,
we recognize nine insurers that
exemplify “Standing the Test of
Time” in one-page news articles
as part of this feature.
Back Through Time
To identify the companies
with the longest record of consistent financial strength, Best’s
analysts pored over the rating
agency’s proprietary data—primarily Best’s Key Rating Guides
and Best’s Insurance Reports—
to accumulate and verify ratings
and other pertinent data dating
back to 1905.
A.M. Best’s Rating Scale has
changed over time in an ongoing
effort to increasingly distinguish
the relative financial strength of
insurers and adapt to changes
in the insurance industry. Therefore, in certain circumstances
it was necessary to translate or
convert various older ratings
to conform to the present rating scale. Please note that these
translations do not represent any
material change or re-evaluation
of a company’s rating; they are
merely a conversion from one
scale to another.
System Launched
The original rating system, implemented in 1906, was
devised by the company’s founder, Alfred M. Best. In 1932, a new
rating scale, General Policyholders Ratings, replaced the previously used Desirability Ratings,
which applied only to property/
casualty insurers.
Desirability Ratings consisted
of two components: a loss-paying
record, ranked on an alpha scale
with “A” being the best; and a rating of management quality, ranked
75
Property/Casualty Insurers
Rated A or Higher for 75 Years
Company Name
AIG Casualty Co.
American Automobile Ins. Co.
American Insurance Co.
American States Insurance Co.
Amica Mutual Insurance Co.
Baltimore Equitable Society
California State Auto Assn. IIB
Camden Fire Insurance Assoc.
Continental Casualty Co.
Country Mutual Insurance Co.
Euler Hermes Amer. Credit Ind.
Farmers Mutual Ins. Co. of NE
Federal Insurance Co.
Federated Mutual Ins. Co.
Fidelity and Deposit Co. of MD
Fireman’s Fund Insurance Co.
General Ins. Co. of America
General Reinsurance Corp.
Germantown Mutual Ins. Co.
Granite State Insurance Co.
Great American Insurance Co.
Great Northern Insurance Co.
Hartford Accident & Indem. Co.
Hartford Casualty Ins. Co.
Hartford Fire Insurance Co.
Hartford Steam Boiler I & I
Hartford Underwriters Ins. Co.
Insurance Co. of the State PA
Lititz Mutual Insurance Co.
Merrimack Mutual Fire Ins. Co.
Montgomery Mutual Ins. Co.
Munich Reinsurance America Inc.
Mutual Assurance Society of VA
National Fire Ins. Hartford
National Union Fire Ins. Co. PA
Nationwide Mutual Ins. Co.
New Hampshire Insurance Co.
New Jersey Manufacturers Ins.
OneBeacon Insurance Co.
Pacific Indemnity Co.
Peerless Insurance Co.
Pharmacists Mutual Ins. Co.
Philadelphia Contrib for Ins.
Providence Mutual Fire Ins.
Continued on page 28
AMB#
02349
02176
02177
02287
02162
03225
00228
02193
02128
02249
02097
00371
02084
00384
00387
02179
02447
02198
00414
02360
02213
02085
02230
02229
02231
00465
02232
02035
00558
02055
00662
00149
03260
02129
02351
02358
02363
00694
02196
02385
02394
00320
03112
00787
A or Higher Current
Since
Rating
1928
A
1933
A
1934
A
1930
A
1922
A++
1933
A+
1927
A+
1934
A
1922
A
1931
A+
1922
A+
1922
A
1907
A++
1934
A+
1922
A
1924
A
1926
A
1928
A++
1923
A
1925
A
1908
A
1923
A++
1922
A
1930
A
1907
A
1922
A+
1926
A
1934
A
1932
A+
1920
A+
1925
A
1923
A+
1933
A+
1914
A
1934
A
1929
A+
1907
A
1934
A++
1934
A
1928
A++
1922
A
1922
A
1922
A+
1918
A
Best’s Review • july 2009
27
75
on a numeric scale with “1” being
the best.
Property/Casualty Insurers
Rated A or Higher for 75 Years
Continued from page 27
Company Name
AMB#
A or Higher Current
Since
Rating
Quincy Mutual Fire Ins. Co.
Selective Ins. Co. of America
St. Paul Fire & Marine Ins. Co.
State Automobile Mutual Ins. Co.
State Farm Mutual Auto Ins. Co.
Tri-State Insurance Co. of MN
Twin City Fire Insurance Co.
United Services Auto Assn.
Western Surety Co.
Westfield Insurance Co.
Westport Insurance Corp.
00796
00826
02452
00855
02479
00918
02235
00934
00974
02382
00347
1922
1930
1926
1925
1929
1927
1921
1927
1935
1934
1922
A+
A+
A+
A+
A++
A+
A
A++
A
A
A
Source: A.M. Best Data. Ratings as of May 18, 2009
75
Life/Health Insurers
Rated A or Higher for 75 Years
Company Name
Aviva Life and Annuity Co.
Beneficial Life Ins. Co.
Country Life Ins. Co.
Genworth Life and Annuity Ins.
John Hancock Life Insurance
Metropolitan Life Ins. Co.
Nationwide Life Ins Co. of Amer.
New York Life Ins. Co.
Northwestern Mutual Life Ins.
Penn Mutual Life Ins. Co.
Principal Life Insurance Co.
Prudential Ins. Co. of America
Standard Insurance Co.
Western and Southern Life Ins.
Source: A.M. Best Data. Ratings as of May 18, 2009
28
Best’s Review • july 2009
AMB#
06199
06162
06294
06648
06601
06704
06971
06820
06845
06903
06150
06974
07069
07243
A or Higher Current
Since
Rating
1929
A
1929
A
1933
A+
1928
A
1928
A++
1928
A+
1928
A
1928
A++
1928
A++
1928
A+
1928
A+
1928
A+
1928
A
1928
A++
Evolving
The rating scale adopted in
1932 had two components: the
Net Resources Rating, the forerunner of today’s Financial Size
Category; and the General Policyholders Rating, which evolved
into today’s Financial Strength
Ratings.
From 1935 through 1975, A.M.
Best did not assign letter ratings to life/health companies.
Instead they had “comments.”
In order to complete this rating history project, a translation
was devised to convert those
“comments” to equivalent letter
ratings. For example, from 1935
to 1952, “More than Ample” was
found to be equivalent to today’s
“A” rating.
Longevity
The nine insurers profiled
here of fer, in microcosm, a
glimpse into how the economic
cycles have affected the insurance industry. They exemplify
the grass-roots growth of the
industry to protect assets. Take,
for example, the small group of
people who gathered in Lititz,
Pa., on May 1, 1888, to organize
a way to safeguard their assets
from fire. Today Lititz Mutual still
is owned by its policyholders.
American Automobile Insurance Co., launched locally in
1912, is now part of a global
insurance giant.
Established in 1860, Guardian
Life Insurance Co. is one of the
nation’s largest mutuals. Country
Mutual Insurance Co. is the oldest active farm bureau insurance
company.
Two of the insurers profiled
have an uncommon business
model. They operate under the
perpetual policy model: taxadvantaged homeowners insurance policies, established with
an initial lump sum paid upfront,
that do not expire.
Best’s Ratings
T
his Rating History
Pr oject is based on
Best’s Financial Strength
Ratings. A Best’s Financial
Strength Rating is an independent opinion, based on a comprehensive quantitative and
qualitative evaluation of a company’s balance sheet strength,
operating performance and
business profile that assesses
a company’s ability to meet its
obligations to policyholders.
A.M. Best Company was
founded in 1899 with the
purpose of performing a constructive and objective role in
the insurance industry toward
the prevention and detection of insurer insolvency.
This mission led to the development of Best’s Ratings,
which are now recognized
worldwide as the benchmark
for assessing insurers’ financial strength. Best’s rating
opinions reflect an in-depth
understanding of business
fundamentals garnered from
more than 100 years of focusing solely on the insurance
industry. This is one reason
why insurance industry professionals have consistently
ranked Best’s Ratings No. 1
in confidence, usefulness and
understanding.
A Best’s Rating is an independent third-party evaluation that subjects all insurers
to the same rigorous criteria,
providing a valuable benchmark for comparing insurers,
regardless of their country of
domicile. Such a benchmark
is increasingly important to
an international market that
looks for a strong indication of stability in the face
of widespread deregulation,
mergers, acquisitions and
other dynamic factors.
50
Cover Story
Property/Casualty Insurers
Rated A or Higher for 50 Years
Company Name
Alfa Mutual Insurance Co.
American Agricultural Ins. Co.
American Cas. Co. Reading, PA
American Family Mutual Ins. Co.
American Home Assurance Co.
American Intern Pacific Ins. Co.
American Security Insurance Co.
American States Ins. Co. of TX
Associated Indemnity Corp.
Barnstable County Mut Ins. Co.
Bay State Insurance Co.
Bear River Mutual Ins. Co.
Cambridge Mutual Fire Ins. Co.
Church Mutual Insurance Co.
Cincinnati Insurance Co.
Commerce and Industry Ins. Co.
Continental Western Ins Co.
Cumberland Mutual Fire Ins. Co.
Economy Fire & Casualty Co.
Erie Insurance Exchange
Farm Bureau Mutual Ins. Co.
Farm Bureau Mutual Ins. of ID
First National Ins. Co. of Amer.
Generali USB
Great American Assurance Co.
Great American Insurance Co. NY
Illinois National Insurance Co.
Kentucky Farm Bureau Mutual
Madison Mutual Ins. Co. (IL)
Merchants Bonding Co. (Mutual)
Midwestern Indemnity Co.
Mountain West Farm Bureau Mut.
National Fire & Marine Ins. Co.
National Indemnity Co.
National Surety Corp.
Nationwide Mutual Fire Ins. Co.
Netherlands Insurance Co.
New York Central Mutual Fire
North Star Mutual Ins. Co.
Ohio Farmers Insurance Co.
Otsego Mutual Fire Ins. Co.
Pennsylvania General Ins. Co.
Safeco Ins. Co of America
State Auto Prop. & Cas. Ins. Co.
Continued on page 30
AMB#
02005
03133
02127
02022
02034
02359
02049
02290
02178
00203
02053
00209
02054
00259
00258
04000
00971
00306
02276
00348
00354
00355
02446
03073
02004
02210
02361
00540
00575
00594
02323
00986
02428
02429
02182
02357
02393
00700
00714
02381
03152
02195
02448
02475
A or Higher Current
Since
Rating
1953
A+
1953
A
1949
A
1939
A
1944
A
1936
A
1952
A
1956
A
1939
A
1949
A
1956
A+
1955
A
1935
A+
1951
A+
1955
A+
1958
A
1951
A+
1956
A
1939
A
1939
A+
1946
A
1959
A+
1940
A
1957
A+
1951
A
1949
A
1937
A
1949
A+
1956
A
1958
A
1956
A
1956
A+
1954
A++
1953
A++
1937
A
1938
A+
1949
A
1936
A+
1953
A+
1935
A
1938
A+
1956
A
1955
A
1954
A+
Best’s Review • july 2009
29
Cover Story
50
Property/Casualty Insurers
Rated A or Higher for 50 Years
Continued from page 29
Company Name
State Farm Fire & Casualty Co.
Swiss Reinsurance America Corp.
Tennessee Farmers Mutual Ins.
Transportation Insurance Co.
Union Insurance Co.
United States Liability Ins. Co.
Universal Surety Co.
Universal Underwriters Ins. Co.
Valley Forge Insurance Co.
Vigilant Insurance Co.
Western Surety Co.
AMB#
02477
03263
00886
02131
02532
02541
02543
02297
02132
02086
00974
A or Higher Current
Since
Rating
1939
A+
1945
A
1954
A++
1941
A
1951
A+
1955
A++
1952
A
1955
A
1950
A
1943
A++
1935
A
Source: A.M. Best Data. Ratings as of May 18, 2009
50
Life/Health Insurers
Rated A or Higher for 50 Years
Company Name
American General Lf. & Accident
American National Ins. Co.
American United Life Ins. Co.
Canada Life Assurance Co.
Columbus Life Insurance Co.
Great-West Life Assurance Co.
Guardian Life Ins. Co. of Amer.
Hartford Life Ins. Co.
Kansas City Life Ins. Co.
Liberty Life Insurance Co.
Liberty National Life Ins. Co.
Lincoln National Life Ins. Co.
Manufacturers Life Ins. Co.
Massachusetts Mutual Life Ins.
Minnesota Life Ins. Co.
Nationwide Life Ins. Co.
Pacific Life Insurance Co.
Protective Life Ins. Co.
ReliaStar Life Insurance Co.
State Farm Life Ins. Co.
Sun Life Assur. Co. of Canada
United of Omaha Life Ins. Co.
United States Life Ins. of NY
Source: A.M. Best Data. Ratings as of May 18, 2009
30
Best’s Review • july 2009
AMB#
06788
06087
06109
06183
06244
06493
06508
06518
06605
06175
06629
06664
06688
06695
06724
06812
06885
06962
06846
07080
07101
07164
07192
A or Higher Current
Since
Rating
1948
A
1941
A+
1950
A
1939
A+
1938
A++
1945
A+
1947
A++
1940
A
1952
A
1954
A
1958
A+
1940
A+
1939
A++
1939
A++
1940
A+
1954
A+
1959
A+
1940
A+
1945
A
1954
A++
1946
A+
1956
A+
1959
A
Anniversary
BestMark
A
M. Best Co. has launch­ed
a program to recognize
insurance companies
that have maintained a financial
strength rating of A or higher for
at least 25 years.
The Anniversary BestMark
program consists of a special
icon—distinct from the standard BestMark—that incorporates the company’s name
and acknowledges the year a
company first achieved the
financial strength rating of A.
Print and Internet-compatible
versions of the icon will be
supplied. Eligible companies
can use this icon in a manner similar to the current
BestMark—for example, on
their Web sites, in print and
online advertising, and on the
cover of Best’s Rating Report
reprints.
Eligible companies can
request an Anniversary
BestMark via e-mail to
bestmarkinsurers@ambest.
com or phone call to A.M. Best,
(908) 439-2200, Ext. 5373.
Financial Strength Rating
A
M
BEST
“A” or Hi
gher Since 1976
YOUR COMPANY
NAME HERE
Watch a video about
this article on
bestreview.com/videos
Company profiles reported by
Editorial Assistant Kate Fry.
Horseless Carriage to Hybrids
American Automobile Insurance Co. has been rated
A or higher by A.M. Best since 1933.
A
merican Automobile Insurance Co., a Fireman’s Fund
Insurance Co. subsidiar y,
launched on Jan. 1, 1912. American
Auto is one of a nine-member intercompany pool with five reinsured
subsidiaries.
Fireman’s Fund is a national, multiline proper ty/casualty insurer, conducting
underw r i t i n g o p e ra tions through four business units, including
commercial and specialty. Fireman’s
Fund is owned by Allianz Group of
Munich, Germany, a leading global
provider of insurance, asset management and banking.
Over the years, Fireman’s Fund
has demonstrated endurance in the
face of catastrophe. Following the
Great Chicago Fire in 1871, many
insurer s went bankr upt while
Fireman’s Fund paid all claims
even though the company’s losses
exceeded its assets. Agents and
adjusters with Fireman’s Fund were
among the first civilians to enter
the areas devastated by hurricanes
Katrina, Rita and Wilma to provide
their policyholders with funds to
get back on their feet.
The company was bold in providing coverage for the
new “horseless carriages,” and issued the first
airplane insurance policy. To help businesses
“go green,” the company offers new
vehicle replacement cost coverage
with the option to upgrade to a
hybrid model. This option helps to
reduce energy costs.
Fi re m a n ’s F u n d m a i n t a i n s a
strong West Coast presence, with
roughly one quarter of the group’s
direct business generated in California. Fireman’s Fund personal lines
business also produces one quarter
of gross premium volume.
Vital Statistics
American Automobile Insurance Co.
(AMB # 02176)
Group Membership:
Fireman’s Fund Insurance
Companies (AMB # 34)
Chief Executive:
Michael LaRocco
Headquarters:
Novato, Calif.
Assets:
Michael LaRocco
1933: $8.561 Million
2008: $13.09 Billion*
*Note: 2008 assets include parent company
Group Results
Total Assets
($ Billions)
15
12
9
6
3
0
2004
2005
2006
2007
2008
Principal Lines of Business
All Other
Allied Lines
Inland
Marine
Comm. M.P.
Other
Liability
Homeowners
Profit Centers
The five states where Fireman’s Fund generates the most premium.
Net Income
Less Than 60
($ Millions)
1,000
WA
MT
OR
ME
ND
ID
MN
SD
NV
CA
AZ
CO
IL
KS
OK
NM
TX
AK
NY
PA
IA
NE
UT
WI
MI
WY
OH
IN
WV
MO
KY
NC
TN
SC
AR
MS
AL
VA
GA
NH
600
MA
RI
CT
400
200
NJ
DE
MD
0
2004
2005
Best’s Review • july 2009
2007
2008
Combined Ratio
110
90
80
2004
2005
2006
2007
Note: After Policyholder Dividends
Source: BestLink
32
2006
100
LA
FL
HI
800
VT
2008
60-90
Cover Story
Engine for Expansion
American States Insurance Co. has been rated A or
higher by A.M. Best since 1930.
A
merican States Insurance Co.
was incorporated in Indiana on
July 15, 1929, and began business the same day. The company's present name was adopted in 1930. In October 1997, American States was acquired
by Safeco Corp., which
itself was acquired by
Liberty Mutual Insurance
Cos. in September 2008.
Liberty Mutual has a
diversified franchise and
maintains an excellent reputation in
service and strong client relationships.
It offers extensive unbundled service
capabilities, risk management services
and strategic alliances with managed
care networks, which gives Liberty
Mutual a significant competitive advantage and a superior market profile.
The Massachusetts Employees’
Insurance Association began operations in 1912. MEIA later changed its
name to Liberty Mutual in 1917. As a
mutual company, MEIA was owned
by policyholders, not stockholders. As such, the mutual company
worked on behalf of its policyhold-
ers, a tradition that continues today.
Liberty Mutual is engaged in underwriting all lines of commercial and
personal business. The group is the
nation’s third-largest commercial lines
writer and the seventh-largest personal
lines writer based on
direct premiums written. Personal lines business ranks high among
the group’s top performing underwriting segments. The group is focusing on new
markets in countries with an emerging middle class. The business is split
approximately 60% commercial and
40% personal lines. The group ranks as
the fifth-largest property/casualty organization in the United States, based on
direct premiums written. In addition
to personal and commercial markets,
the group operates in agency and international markets. In early 2009 Liberty
Mutual said it would sell its middle-market direct distribution business and its
Wausau agency brand to focus on selling to this market only through independent agents and brokers.
Profit Centers
Vital Statistics
American States Insurance Co.
(AMB # 2287)
Group Membership:
Liberty Mutual Insurance
Companies (AMB # 60)
President:
Edmund F. Kelly
Headquarters:
Indianapolis, Ind.
Assets:
Edmund F. Kelly
1930: $638,000
2008: $2.07 Billion
Group Results
Total Assets
($ Billions)
80
60
40
20
0
2004
2005
2006
2007
Principal Lines of Business
All
Other
Workers’
Comp
PP Auto
Liability
Comm.
M.P.
Auto Phys.
Damage
Homeowners
Net Income
The five states where Liberty Mutual generates the most premium.
2008
Less Than 60
($ Billions)
60-90
2.0
WA
MT
OR
ID
SD
CA
UT
AZ
CO
NY
IL
OK
NM
TX
PA
IA
KS
AK
WI
MI
NE
1.0
VT
MN
WY
NV
1.5
ME
ND
OH
IN
WV
MO
KY
NC
TN
SC
AR
MS
AL
VA
GA
LA
FL
NH
NJ
DE
MD
MA
RI
CT
0.5
0.0
2004
2005
2006
2007
2008
Combined Ratio
105
103
101
99
97
95
2004
2005
2006
2007
2008
Note: After Policyholder Dividends
HI
Source: BestLink
Best’s Review • july 2009
33
Cover Story
Homeownership Is the Policy
The Baltimore Equitable Society has been rated A or
higher by A.M. Best since 1933.
T
he Baltimore Equitable Soci- promptly paid in full.
ety, one of the city’s oldest
The Society’s expertise as a specialty
corporations, has maintained writer of perpetual fire and homeowna long-standing marketing presence ers policies, as well as its knowledge
in Maryland.
of the Baltimore market, has played a
The Society was founded in 1794. crucial role in its success. Baltimore
Throughout its history, the company Equitable is one of several insurance
has maintained a strong tradition of companies in the United States that
prompt and full payment to its poli- operates under the perpetual policy
cyholders. On Dec. 4,
deposit method. As a
1796, the Society suswriter of perpetual
Baltimore Equitable
Insurance
tained its first loss
insurance policies, Balwhen a fire consumed
timore Equitable coltwo brick houses at
lects an initial deposit
Light and Baltimore streets. The blaze for each policy in lieu of premium.
also destroyed a number of other The company’s large investment portbusinesses, homes and a church.
folio generates income, as well as realAt the turn of the century, the city ized capital gains, to pay claims and
of Baltimore experienced another trag- cover operating expenses. The comedy. On Feb. 7, 1904, a wholesale dry pany writes only homeowners and
goods house caught fire in the heart broad-form fire policies in Maryland
of the city’s business district.The Great and Pennsylvania on a direct basis. The
Baltimore Fire destroyed 150 acres and Society’s strong franchise and unique
2,500 businesses and total damages product have contributed to favorable
reached $150 million. The fire affected growth and business persistence in its
455 policyholders and despite the current markets. These factors have
company’s significant losses, The Soci- also provided an opportunity to diverety ensured that all policyholders were sify its product into Pennsylvania.
Invested Assets
Bond Portfolio Composition
Annual Statement 2008
Vital Statistics
Baltimore Equitable Society
(AMB # 3225)
President:
Timothy J. Swartz
Headquarters:
Baltimore, Md.
Assets:
1933: $2.114 Million
2008: $108.594 Million
Timothy J.
Swartz
Company Results
Total Assets
($ Millions)
150
120
90
60
30
0
2004
2007
2008
($ Millions)
85
68
51
34
17
0
2004
2005
2006
2007
2008
Net Income
(%)
($ Millions)
50
100
40
80
30
60
5
4
3
2
1
0
-1
-2
-3
2004
2005
2006
2007
2008
40
20
Yield on Invested Assets
20
10
0
34
2006
Policyholders’ Surplus
($ Millions)
0
2005
Bonds
(Schedule D)
Common
Stocks
Cash, Cash
Equivalents &
Short-Term
Investments
Best’s Review • july 2009
% of Total
Government
Corporate
Class 1-2(%)*
State, Terr & Poss
*Percentage of bonds invested in the two
highest quality categories
5
4
3
2
1
0
2004
2005
Source: BestLink
2006
2007
2008
Farms Yield Long-Term Gains
Country Mutual Insurance Co. has been rated A or
higher by A.M. Best since 1931.
S
ince 1925, Country Mutual states. Recently, Country Financial
Insurance Co. has specialized has been expanding its portfolio
in farm insurance and built of multiline personal policies. Geoupon its strong agricultural roots to graphic and product expansions
become one of the leading insurers have resulted from the affiliations
of farms and ranches in Alaska, Illi- and acquisitions, and management
nois, Nevada, Oregon and Washing- has a proven track record of producton. A subsidiary of Country
ing profitable results in years
Financial, which consubsequent to the
sists of nine compamerger s. Countr y
nies, Country Mutual
Financial is predomleads the group as the
inantly a personal
FINANCIAL
oldest active farm bureau
lines writer, generating
insurance company in the
approximately half of its
United States.
total direct premium revenue in IlliCountry Financial began as a fire nois, with the balance written in 35
and lightning insurance company in additional states.
1925. A year later, the company began
Country Financial benefits from an
to offer crop, hail and farm equip- effective distribution network, cusment insurance, and over time offered tomer loyalty, broad technology platauto and life insurance as well.
form and local market knowledge.
Today it is primarily focused on In addition, the group focuses on
private-passenger auto and home- cross-selling of products to further
owner lines, and farm and small strengthen its high business reten“main street” commercial insurance tion ratio. Such attributes have made
products, including agricultural cov- it one of the 40 largest U.S. property/
erage in Farm Bureau-sponsored casualty groups.
Profit Centers
The five states where Country Financial generates the most premium.
Vital Statistics
Country Mutual Insurance Co.
(AMB # 2249)
Group Membership:
Country Financial
(AMB # 302)
Chief Executive:
John Blackburn
Headquarters:
Bloomington, Ill.
Assets:
John Blackburn
1931: $616,000
2008: $3.37 Billion
Group Results
Total Assets
($ Billions)
5
4
3
2
1
0
2004
2005
2006
2007
2008
Principal Lines of Business
Allied
Lines
All
Other
Comm.
M.P.
Auto
Phys.
Damage
PP Auto
Liability
Homeowners
Net Income
Less Than 60
($ Millions)
200
WA
MT
OR
ID
SD
CA
UT
AZ
CO
NY
IL
OK
NM
TX
PA
IA
KS
AK
WI
MI
NE
100
VT
MN
WY
NV
150
ME
ND
OH
IN
WV
MO
KY
NC
TN
SC
AR
MS
AL
VA
GA
LA
FL
NH
NJ
DE
MD
MA
RI
CT
50
0
2004
2005
2006
2007
Combined Ratio
108
104
100
96
92
88
2004
2005
2006
2007
Note: After Policyholder Dividends
HI
36
Best’s Review • july 2009
2008
Source: BestLink
2008
60-90
Cover Story
All the Right Moves
ANNUAL REPORT 2008
Guardian Life Insurance Company of America has
been rated A or higher by A.M. Best Co. since 1947.
T
he Guardian Life Insurance focuses on expanding and improvCompany of America, a subsid- ing its career agency system while
iary of Guardian Life Group, growing supplementary independent
is one of the largest U.S. mutual life agent and broker channels to distribinsurance companies. It was founded ute its individual insurance products.
by Hugo Wesendonck in 1860 in New
A.M. Best upgraded Guardian’s
York and called the Germania Life
financial strength ratings to A++
Insurance Company of New York.
from A+ in late 2008. The ratings
By 1868, Germania was the
reflect Guardian’s superior capifirst U.S. insurance comtalization, maintenance of
pany to establish an
positive earnings trends
a ge n c y i n E u r o p e .
and the organization’s sucAlmost half of Gercessful execution of sevmania’s business was outside North eral key strategic initiatives over the
America by the early 1900s, until past several years. The upgrade also
the pressures of World War I forced considers the group’s well-diversified
the company to stop writing busi- product portfolio, underpinned by
nessOur
in Europe.
1917, theprovides
com- strong positions in its core life, annufinancialInstrength
pany changed its name to Guardian ity, individual disability, dental and
Life Insurance Company of America. employee benefits markets.
Today the company is licensed in all
In 2006, Guardian Life introduced
states and the District of Columbia.
“The Living Balance Sheet,” a WebGuardian Life provides a full range based tool that allows customers to
of insurance, investment, securities consolidate their financial informabrokerage and other related prod- tion. This improves the agent’s abilucts and services through a number ity to provide financial solutions to
of affiliates. Its strategy for growth customers.
PEACE OF MIND
Primary Lines of Business (Company)
($ Billions)
Ordinary Life
Group Life
Group Accident & Health
Guardian Life Insurance Company of America
(AMB # 6508)
Group Membership:
Guardian Life Group
(AMB # 20389)
Chief Executive:
Dennis J. Manning
Headquarters:
New York, N.Y.
Assets:
Dennis J.
1947: $226,000
Manning
2008: $28.97 Billion
Company Results
Total Assets
($ Billions)
30
25
20
15
10
5
0
2004
2005
2006
2007
2008
Total Capital & Surplus
($ Billions)
4.0
3.5
3.0
2.5
2.0
1.5
1.0
0.5
0.0
2004
2005
2006
2007
2008
Net Operating Gain
To Total Revenue
(%)
3,500
5
4
3,000
3
2
2,500
2,000
2004
2005
2006
2007
2008
2006
2007
2008
Total Return
(%)
1500
8
6
1000
4
2
500
0
Vital Statistics
0
2004
2005
2006
2007
2008
2004
2005
Source: BestLink
Best’s Review • july 2009
37
Cover Story
Insurer Grew
From Grass Roots
Lititz Mutual has been rated A or higher by
A.M. Best since 1932.
O
n May 1, 1888, 25 citizens primarily along the East Coast of the
from Lancaster County in United States.
Pennsylvania gathered in
The company’s largest state of
Lititz to organize the Agricultural operation is Pennsylvania with 38%
Mutual Fire Company of Lancaster of total direct writings. Its underCounty. Dedicated to their Penn- writing operations are centered prisylvania Dutch heritage,
marily on homeowners
these citizens adopted
coverage, which comprisby-laws on the principles
es approximately 72%
of thrift, integrity and
of net premium volume.
full measure for value
In terms of policyholdreceived.
ers’ surplus, the company is
The Lititz Mutual Insuramong the largest mutual
ance Co., as it is known
insurers in America.
today, is a subsidiary of Lititz
Lititz Mutual is proud of
Mutual Insurance Group.
its agricultural background.
The group is led by Lititz
With a solid foundation of
Mutual Insurance Co., and
the principles adopted by
Henry R. Gibbel
includes its three reinsured
its founders, the company
affiliates.
has built one of the leadThe operations of the companies ing mutual insurance companies
are conducted in nine states located in Pennsylvania.
Vital Statistics
Lititz Mutual Insurance Co. (AMB # 558)
Group Membership:
Lititz Mutual Insurance
Group (AMB # 18518)
Chief Executive: Henry
H. Gibbel
President and COO:
Henry R. Gibbel
Headquarters: Lititz, Pa.
Assets:
Henry H. Gibbel
1932: $270,000
2008: $185.5 Million
Group Results
Total Assets
($ Millions)
300
250
200
150
100
50
0
2004
2005
Allied Lines
Farmowners
Fire
MT
OR
ID
CA
AZ
CO
NY
IL
OK
NM
TX
PA
IA
KS
AK
WI
MI
NE
UT
VT
MN
SD
WY
NV
14
12
10
8
6
4
2
0
-2
ME
ND
OH
IN
WV
MO
KY
NC
TN
SC
AR
LA
LA
MS
AL
VA
GA
Homeowners
Less Than 60
($ Millions)
WA
NH
NJ
DE
MD
MA
RI
CT
2004
2005
2006
2007
Combined Ratio
120
80
2004
2005
2006
2007
Note: After Policyholder Dividends
38
Best’s Review • july 2009
2008
100
FL
HI
2008
All
Other
Net Income
The five states where Lititz Mutual generates the most premium.
2007
Principal Lines of Business
Comm M.P.
Profit Centers
2006
Source: BestLink
2008
60-90
Finding a Strong Niche
Mutual Assurance Society of Virginia has been rated
A or higher by A.M. Best since 1933.
F
o r t h e M u t u a l A s s u ra n c e
Society of Virginia, the fundamental principle of “mutual
assurance and mutual risk” that
originated in the Society’s charter remains true today. As the oldest fire insurance company
and the oldest continuously
operated corporation in
Virginia, Mutual Assurance
was founded on Dec. 22,
1794, by an act of incorporation from the Virginia Legislature. The company began
operations as a fire underwriter
in Richmond and the surrounding
area in 1795 under the name The
Mutual Assurance Society, Against
Fire on Buildings, of the State of
Virginia.
Since inception, the company has
written single-premium assessable
perpetual term policies. The company confined its operations to fire
insurance until May 17, 1955, when
the charter was modified to include
the writing of miscellaneous property and water damage coverage.
The company amended its charter
again in June of 1965 to further
expand its permitted activities to
include the writing of multiple-line
coverage when issued as a supplemental or comprehensive
contract in connection with
a fire insurance policy.
The company maintains
a long-standing market presence in Richmond and its surrounding areas as a specialty
writer of perpetual-type fire and
homeowners insurance. A variety
of personal lines coverages are
written throughout the state on a
single premium with a continuous
policy. Underwriting emphasis is
placed on homeowners policies
for preferred risks.
Strong branding has enabled
Mutual Assurance to achieve favorable growth and business persistence in established markets.
Policyholders’ Surplus
Yield on Invested Assets
($ Millions)
(%)
250
3.5
Mutual Assurance Society of Virginia
(AMB # 3260)
Chief Executive:
L. Gerald Roach
Headquarters:
Richmond, Va.
Assets:
1933: $4.06 Million
2008: $171 Million
L. Gerald Roach
Company Results
Total Assets
($ Millions)
250
200
150
100
50
0
Fire
2007
2008
2.9
Other Liability
Homeowners
8
4
0
-4
-8
2004
2005
800
700
600
500
400
300
200
100
2004
2005
2006
2007
2008
Best’s Review • july 2009
2007
2004
2005
2006
2007
Note: After Policyholder Dividends
Source: BestLink
40
2006
2008
Combined Ratio
3.0
2006
2008
12
3.1
2005
2007
($ Millions)
100
2004
2006
Net Income
3.2
50
2005
Rein-NPA
Liability
3.3
150
2004
Principal LinesAllied
of Business
Lines
3.4
200
0
Vital Statistics
2008
O
Cover Story
Regional Specialists
Selective Insurance Company of America has been
rated A or higher by A.M. Best since 1930.
A
s the leading member of Selec- been the foundation of Selective’s
tive Insurance Group, Selec- strategy.
tive Insurance Company of
As a regional multiline property/
America contributes to the group’s casualty organization, Selective has dedstrong reputation and ranking among icated service capabilities, and offers a
the top 50 property/casualty organi- broad range of insurance products and
zations in the United States, based on services. Selective’s successful fieldnet premiums written.
based operating model and its technolIn the 1920s, Daniel L.B. Smith, ogy infrastructure gives the group the
the founder of Selective, operated ability to leverage its strong agency
a small chain of general stores in relationships. It has sustained strong
Sussex County, N.J.
market penetration
® and maintained high
He lent a horse and
SELECTIVE policyholder-retention
carriage to one of his
friends, a banker and
rates.
insurance agent. The horse ran away
Selective primarily writes two types
and wrecked the carriage but Smith of business. Commercial lines reprerefused to take any payment. When sent approximately 87% of net premithe friend moved away, he gave Smith ums written, while personal lines repsome policy declarations for farms resent approximately 13%. The group
and homes he had insured through sells its property/casualty products and
his agency, which then became the services in 22 states, with New JerD.L.B. Smith Agency. Over time, Smith sey accounting for nearly 30% of the
became well-known as a man who group’s net premiums at year-end 2008.
cared about his clients and kept his Pennsylvania, New York, Maryland and
word. His commitment to providing Virginia together represent more than
the best service and products has 65% of the group’s writings.
Vital Statistics
Selective Insurance Company of America
(AMB # 826)
Group Membership:
Selective Insurance
Group (AMB # 3926)
Chief Executive:
Gregory E. Murphy
Headquarters:
Branchville, N.J.
Assets:
Gregory E.
1930: $307,000
Murphy
2008: $2.24 Billion
Group Results
Total Assets
($ Billions)
5
4
3
2
1
0
2004
2005
Profit Centers
2007
2008
Principal Lines of Business
Other
Liability
All
Other
Auto
Phys.
Damage
Comm.
Auto
Liability
PP Auto
Liability
The five states where Selective Insurance Group generates the most premium.
2006
Workers’
Comp
Net Income
Less Than 60
($ Millions)
60-90
200
WA
MT
OR
ID
SD
CA
UT
AZ
CO
NY
IL
OK
NM
TX
PA
IA
KS
AK
WI
MI
NE
100
VT
MN
WY
NV
150
ME
ND
OH
IN
WV
MO
KY
NC
TN
SC
AR
MS
AL
VA
GA
NH
NJ
DE
MD
MA
RI
CT
50
0
2004
2005
2006
2007
2008
Combined Ratio
100
98
96
LA
94
FL
92
2004
2005
2006
2007
2008
Note: After Policyholder Dividends
HI
Source: BestLink
Best’s Review • july 2009
41
Cover Story
Survival Tactics
Westfield Insurance Co. has been rated A or higher by
A.M. Best since 1934.
A
s a leading multiline property/casualty company of
Westfield Group, Westfield
Insurance Co. plays a major role in
the group’s ranking among the 10
largest writers in Ohio. The group
writes business in the Midwest
and South Atlantic regions of
the United States, offering a
broad range of insurance
and related products to
individuals and businesses.
As one of the top writers of farm business in the
United States, it comes as no
surprise that Westfield was founded by
a small group of Ohio farmers who
joined together to form the Ohio
Farmers Insurance Co. in order to
protect their property.
In the late 1800s, the company
was in search of a logo and finally
chose an image, provided by a local
printer, of a farmer sitting on a
fence. The image, which became
known as “The Old Man on the
Fence,” epitomized the company’s
philosophy: honest, independent
and hard-working.
Westfield is a provider of commercial and personal insurance in
18 states, with the breakdown
of the business approximately
35% personal lines and 65%
commercial lines. In addition, Westfield provides
surety services to customers. The group is the
largest writer of contract
performance bonds in Ohio.
The group has significantly
expanded its market outside of
Ohio and into nearby Midwestern
states. In 2000, Westfield acquired
the Old Guard group of insurance
companies, located in Lancaster, Pa.,
to diversify geographic risk. The
group holds $3.6 billion in consolidated assets and $1.7 billion in written premium.
Vital Statistics
Westfield Insurance Co.
(AMB # 2382)
Group Membership:
Westfield Group (AMB #
730)
Chief Executive:
Robert J. Joyce
Headquarters:
Westfield Center, Ohio
Assets:
1934: $819,000
2008: $2.12 Billion
Group Results
Total Assets
($ Billions)
4
3
2
1
0
2004
2005
The five states where Westfield Group generates the most premium.
WA
MT
All
Other
OR
ID
CA
AZ
CO
IL
KS
OK
NM
TX
AK
PA
IA
NE
UT
NY
MI
WY
NV
WI
OH
IN
WV
MO
KY
NC
TN
SC
AR
MS
AL
VA
GA
LA
FL
NH
NJ
DE
MD
PP Auto
Auto Liability
Phys.
Damage
Less Than 60
($ Millions)
100
80
60
40
20
0
-20
MA
RI
CT
2004
2005
2006
2007
42
Best’s Review • july 2009
2008
Combined Ratio
102
100
98
96
94
92
90
88
2004
2005
2006
2007
Note: After Policyholder Dividends
HI
2008
Comm.
M.P.
Net Income
VT
MN
SD
2007
Homeowners
ME
ND
2006
Principal Lines of Business
Allied
Lines
Profit Centers
Robert J. Joyce
Source: BestLink
2008
60-90