Home » NEWS » Health » Medical Assurance's ratings upgraded by A.M. Best

Medical Assurance's ratings upgraded by A.M. Best

health-insurance_rgbRIDGELAND — A.M. Best has upgraded the financial strength rating to “A (Excellent)” from “A- (Excellent)” and issuer credit rating to “a” from “a-” of Medical Assurance Company of Mississippi (MACM). The outlook for both ratings has been revised to “stable” from “positive.”

A.M. Best wrote: “The ratings of MACM are reflective of its strong risk-adjusted capitalization, its history of favorable operating performance and conservative loss reserve position. The company also benefits from its sustainable expense advantage and dominant position in providing medical professional liability (MPL) insurance within the Mississippi physicians market.

“These positive rating factors are partially offset by the inherent market risks associated with being a single state, monoline MPL insurer, particularly as these risks relate to legislative (tort) reform, regulatory challenges and loss cost trends. MACM also exhibits elevated common stock leverage, increasing the potential for changes in surplus from volatility in the equity markets.

“The company has benefited from its conservative approach in booking case reserves, which has contributed to MACM’s ability to continue its mission of providing a long-term stable market for physicians in Mississippi. The company operates as a non-profit organization and is not required to pay state taxes nor obligated to participate in the state’s guaranty fund—all the while maintaining rate flexibility. However, MACM remains exposed to the potential for tort reform legislation on constitutional grounds as well as the potential for inconsistent awards by juries in Mississippi.

“The outlook is based on A.M. Best’s expectation of continued solid capitalization and sustained strong operating profitability under the company’s relatively stable operating environment.

“Positive rating actions are not anticipated in the midterm, as MACM’s capitalization, operating performance and business profile fully support its current ratings. However, the company’s ratings/outlook may be adversely impacted by the development of a trend of unprofitable underwriting, adverse loss reserve development, or a significant decline in risk-adjusted capitalization.”

BEFORE YOU GO…

… we’d like to ask for your support. More people are reading the Mississippi Business Journal than ever before, but advertising revenues for all conventional media are falling fast. Unlike many, we do not use a pay wall, because we want to continue providing Mississippi’s most comprehensive business news each and every day. But that takes time, money and hard work. We do it because it is important to us … and equally important to you, if you value the flow of trustworthy news and information which have always kept America strong and free for more than 200 years.

If those who read our content will help fund it, we can continue to bring you the very best in news and information. Please consider joining us as a valued member, or if you prefer, make a one-time contribution.

Click for more info

About MBJ Staff

Leave a Reply

Your email address will not be published. Required fields are marked *

*