AM Best has downgraded the credit ratings of Texas Farm Bureau Casualty Insurance Company and its affiliates, lowering the Financial Strength Rating (FSR) to B++ (Good) from A- (Excellent) and the Long-Term Issuer Credit Ratings (Long-Term ICR) to “bbb+” (Good) from “a-” (Excellent). This downgrade stems from deterioration in key balance sheet strength metrics due to significant underwriting losses related to severe weather in Texas, which contributed to a 21.5% drop in policyholder surplus. While the outlook for the FSR has been revised to stable, the Long-Term ICR outlook remains negative, indicating ongoing operational volatility and declining risk-adjusted capitalization. Management is implementing measures to restore profitability, including rate increases and refined underwriting practices.
