AM Best has revised the outlook to negative from stable for the Long-Term Issuer Credit Rating (Long-Term ICR) and affirmed the Financial Strength Rating (FSR) of B++ (Good) and the Long-Term ICR of “bbb+” (Good) of Farmers Fire Insurance Company (Farmers Fire) (York, PA). The outlook of the FSR is stable.
The Credit Ratings (ratings) reflect Farmers Fire’s balance sheet strength, which AM Best assesses as strong, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management.
The revision of the balance sheet strength assessment to strong from very strong and the negative outlook on the Long-Term ICR reflects pressure on Farmers Fire’s balance sheet strength assessment resulting from a material loss of policyholder surplus in 2025. The 16.5% surplus loss was due to weather-related losses that fell within the company’s reinsurance retention, and drove an increase in leverage measures. Management implemented initiatives to improve underwriting performance including rate action, tightening of underwriting guidelines, and restructuring the reinsurance program, which is anticipated to result in significant savings starting in 2026.
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.
Copyright © 2026 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.
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