AM Best has revised the outlooks to negative from stable and affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Ratings of “a-” (Excellent) of Physicians Insurance A Mutual Company (Seattle, WA), and its reinsured subsidiary, Physicians Insurance RRG, Inc. (Burlington, VT). Physicians Insurance Mutual Group is referred to as PI.

The Credit Ratings (ratings) reflect the PI’s balance sheet strength, which AM Best assesses as strongest, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management.

The negative outlooks reflect AM Best’s expectation of continued pressure on PI’s operating performance over the intermediate term. Over the most recent five-year period, underwriting losses have continued due to increased claims costs and adverse prior-year development. PI’s return metrics and operating ratios underperformed the medical professional liability peer composite average. Management has implemented various corrective actions to improve underwriting results; however, the actions have yet to bolster underwriting profitability.

Negative rating action could occur if anticipated improvements in PI’s underwriting and overall operating performance fail to materialize, resulting in a continuation of performance measures that fall below that of its peers.

This press release relates to Credit Ratings that have been published on AM 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 AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best's Credit Ratings. For information on the proper use of Best’s Credit Ratings, Best’s Performance Assessments, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.

AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.

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