A.M. Best Revises Outlook to Positive for Missouri Employers Mutual Insurance Company

Business Wire, April 28, 2008

OLDWICK, N.J. -- A.M. Best Co. has affirmed the financial strength rating (FSR) of A- (Excellent) and issuer credit rating (ICR) of "a-" of Missouri Employers Mutual Insurance Company (MEM) (Columbia, MO). The outlook for the ratings has been revised to positive from stable.

The ratings and positive outlook are based on the company's excellent capitalization, strong underwriting through improved reserve development, consistent operating performance and dominant position in the Missouri workers' compensation market. While MEM is technically a state fund, it is not a state agency and is not the insurer of last resort or the residual market in Missouri, but it benefits from its ability to utilize multiple pricing tiers and its exemption from federal income taxes.

These positive rating factors are somewhat offset by MEM's concentrated business risk, operating as a monoline writer with a limited geographic spread that exposes its operations to changes in local regulatory, economic and competitive environments as well as the variability of underwriting results in earlier accident years. Despite these concerns, the rating outlook is reflective of the company's ability to sustain strong underwriting and operating performance, resulting in excellent overall capitalization.

For Best's Ratings, an overview of the rating process and rating methodologies, please visit www.ambest.com/ratings.> Founded in 1899, A.M. Best Company is a global full-service credit rating organization dedicated to serving the financial and health care service industries, including insurance companies, banks, hospitals and health care system providers. For more information, visit www.ambest.com.