A.M. Best has upgraded the issuer credit rating to “a+” from “a” and affirmed the financial strength rating of "A (Excellent)" of the Investment Company Institute (ICI) Mutual Insurance Company, a risk retention group. The outlook for all ratings is stable.
The ratings reflect ICI Mutual’s strong capitalisation, favourable underwriting and operating results, and vast intellectual capital and expertise within the mutual fund industry. The company’s balance sheet is supported by its low underwriting leverage, in addition to management’s conservative reserving philosophy and proactive claims and risk management strategy.
ICI Mutual’s positive rating attributes are derived from its strategic role as a captive insurance company for the mutual fund industry as well as from the significant market penetration of its sponsor, ICI, which is the national trade association of US investment companies whose members manage total assets of over $14.7 trillion, owned by 90 million investors.
Positive rating actions could occur if ICI Mutual continues to produce strong operating profitability relative to its peer group and maintains strong risk-adjusted capital. Negative rating actions could occur if capitalisation and/or operating performance fall markedly short of A.M. Best’s expectations, including a significant deterioration in loss trends. Given ICI Mutual’s narrow business scope, the ratings also are subject to any sudden shifts within its core market niche or a drastic change in its business profile.
