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AM Best has moved the outlook on American Agricultural Insurance Company’s (AmericanAg) Long-Term Issuer Credit Rating (Long-Term ICR) to positive from stable, while maintaining the company’s Financial Strength Rating (FSR) at A (Excellent) and its Long-Term ICR at “a” (Excellent), with the outlook for the FSR remaining stable.
AmericanAg, based in Indianapolis, provides reinsurance products and services primarily to Farm Bureau organisations across the United States, while also participating in domestic and international reinsurance programmes through the broker market.
AM Best said its ratings assessment reflects AmericanAg’s strongest balance sheet strength, adequate operating performance, neutral business profile and appropriate enterprise risk management (ERM).
The positive outlook for the Long-Term ICR reflects what AM Best described as continued progress in AmericanAg’s operating performance. The rating agency said improvements in underwriting results and rising investment income have contributed to the company’s stronger financial performance in recent years.
AM Best attributed the improvement in underwriting results to a combination of higher rates, stronger management of risks and exposures, and relatively favourable weather conditions. Although weather-related events have affected earnings, AM Best said these losses have not weakened AmericanAg’s capital position.
The company has also strengthened its revenue base, according to AM Best, through a broader mix of business and increased participation in direct crop insurance. AmericanAg has additionally expanded its non-risk-bearing business. AM Best said this activity contributes to net income and could help support earnings when market conditions become softer.
AM Best said AmericanAg remained on course to deliver profitable results for the first six months of 2026. The rating agency also noted that 2024 and 2025 represented the strongest years in the company’s history, despite AmericanAg recording its largest loss payout in 2024 and its third-largest in 2025.
AmericanAg’s balance sheet continues to benefit from what AM Best assesses as the strongest level of risk-adjusted capitalisation, measured by the Best’s Capital Adequacy Ratio (BCAR). AM Best also pointed to stable loss-reserving trends, adequate liquidity and generally positive operating cash flow as supporting factors.
The company’s reinsurance arrangements are another important component of its financial position and risk management approach. AM Best said AmericanAg has a comprehensive reinsurance programme supported by strong reinsurance partners. Its investment portfolio also provides a consistent source of investment income.
AM Best continues to classify AmericanAg’s business profile as neutral. The company’s core role is providing reinsurance to Farm Bureau organisations throughout the US, while its participation in brokered domestic and international programmes provides access to a varied portfolio of business.
According to AM Best, AmericanAg’s ERM framework is well established and remains appropriate for the complexity of its risk profile. The rating agency also identified the company’s reinsurance programme as an important part of its wider approach to managing risk.
The post AM Best revises AmericanAg’s rating outlook to positive appeared first on ReinsuranceNe.ws.
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