Market Overview

A.M. Best Upgrades Credit Ratings of Medical Mutual Insurance Company of Maine


A.M. Best has upgraded the Financial Strength Rating (FSR) to A
(Excellent) from A- (Excellent) and the Long-Term Issuer Credit Ratings
(Long-Term ICR) to "a" from "a-" of Medical Mutual Insurance Company
of Maine
(MMIC) (Portland, ME), lead member of Medical Mutual
Group of Maine
(MMGM). The Credit Rating (rating) outlooks have been
revised to stable from positive.

The ratings reflect MMGM's balance sheet strength, which A.M. Best
categorizes as strongest, as well as its strong operating performance,
limited business profile and appropriate enterprise risk management.

These rating actions reflect the group's disciplined underwriting
strategy, which has resulted in profitable underwriting income, before
policyholder dividends, in recent years despite challenging market
conditions and a decline in the magnitude of favorable reserve
development on prior accident years. MMGM's operating earnings also have
benefited from significant net investment income during this time. As a
result, operating profitability has outpaced the medical professional
liability (MPL) composite. Furthermore, the ratings reflect the cycle
management programs and review processes put into place to reduce
volatility should the MPL market deteriorate in the group's key
jurisdictions. These positive rating factors are offset partially by the
inherent market risks associated with the MPL sector as it relates to
price competition, loss cost trends, regulatory challenges and changes
in the overall U.S. healthcare system.

The stable outlooks are based on A.M. Best's expectation that the
group's rating fundamentals for balance sheet strength, operating
performance, business profile and enterprise risk management will be
maintained over the medium term.

This press release relates to Credit Ratings that have been published
on A.M. Best's website. For all rating information relating to the
release and pertinent disclosures, including details of the office
responsible for issuing each of the individual ratings referenced in
this release, please see A.M. Best's
Rating Activity
web page. For additional information
regarding the use and limitations of Credit Rating opinions, please view
Best's Credit Ratings
. For information on the proper media
use of Best's Credit Ratings and A.M. Best press releases, please view
for Media - Proper Use of Best's Credit Ratings and A.M. Best Rating
Action Press Releases

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