A.M. Best Revises Outlook to Positive for The Brethren Mutual Insurance Company

Business Wire, May 16, 2008

OLDWICK, N.J. -- A.M. Best Co. has revised the outlook to positive from stable and affirmed the financial strength rating of A- (Excellent) and issuer credit rating of "a-" of The Brethren Mutual Insurance Company (Brethren Mutual) (Hagerstown, MD).

The ratings reflect Brethren Mutual's solid capitalization, favorable operating performance and long standing market presence in Maryland. These positive rating factors are partially offset by Brethren Mutual's geographic concentration in Maryland, although the company has taken steps to diversify its geographic presence through expansion in Pennsylvania and western areas of Virginia. While Brethren Mutual's common stock leverage remains relatively high, recent years have witnessed a declining trend in this measure as the company has produced rapid surplus growth.

The outlook is based on Brethren Mutual's prudent operating strategies, which have produced significantly improved underwriting and operating performance in recent years.

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.