AM Best affirms ratings of FLMIC

AM Best has revised the outlook to positive from stable for the long-term issuer credit rating and affirmed the financial strength rating of A and the long-term ICR of “a” of Florida Lawyers Mutual Insurance Company (FLMIC). The outlook of the FSR is stable.

FLMIC is a Vermont-registered captive insurance company that was founded by the Florida Bar to provide coverage for lawyers in Florida.

The ratings reflect FLMIC’s balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management (ERM).

The change in the long-term ICR outlook to positive from stable reflects FLMIC’s sustained positive operating performance over the past five years based on positive annual underwriting income supported by growing net investment income. The positive underwriting results were aided by the company’s pure loss ratio, which compares favourably with AM Best’s commercial casualty composite; however, it is partially offset by an elevated underwriting expense ratio, primarily driven by higher overhead. In addition, FLMIC has reported profitable pre-tax and total return and combined ratio measures that compare favourably with the composite averages over the past five years.

FLMIC maintains a neutral business profile assessment based on its strong market share position in Florida. All business continues to be underwritten by FLMIC and its control over product distribution has aided in fairly consistent operating results in recent years.

AM Best said that it considers FLMIC’s ERM program to be appropriate for its size and scope of operations, which allows it to monitor its concentration of risks in Florida and to purchase an appropriate limit of reinsurance to mitigate these exposures.

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