AM Best has revised the outlooks to negative from stable and affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Rating of “a-” (Excellent) of SOCIETY INSURANCE, a mutual company (SOCIETY) (Fond du Lac, WI).

The Credit Ratings (ratings) reflect SOCIETY’s balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management (ERM).

The revised outlooks to negative from stable are based on underwriting losses that have been reported in five consecutive years, with heightened losses occurring in 2023 and 2024. SOCIETY’s net underwriting losses peaked in 2023 driven by an increase in catastrophe events and large loss experience that continued into 2024, resulting in deterioration of the company’s combined ratio and operating return metrics. The combined ratio has been above breakeven in four of the past five years and now exceeds the composite average. Despite the unfavorable trend in recent years, the company’s loss and loss adjustment expense ratios remain comparable with the composite and corrective actions are in place to improve results going forward. In resolving the negative outlook, AM Best’s focus will be on the extent to which management’s recent premium rate and other underwriting actions gain traction in the remainder of 2025 and early 2026 and lead to a sustainable trend of improved underwriting performance and internal capital generation.

SOCIETY’s very strong balance sheet is based on the company’s strongest risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR). Balance sheet strength is further supported by a sound liquidity position, moderate underwriting leverage and a conservative investment risk profile. Surplus note issuance in 2025 has helped sustain risk-adjusted capitalization, tempered by an increase in financial leverage and debt servicing costs for the enterprise.

The business profile reflects SOCIETY’s long-standing agency relationships, industry trade association endorsements, and in-depth expertise in select business niches. Its specialty market/commercial book of business exposes results to frequent and severe weather-related events, large losses and competitive market pressures. Ongoing diversification into other states outside of its home state of Wisconsin has expanded its footprint. ERM is considered appropriate for its risk profile, commensurate with the complexity and scale of the company.

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.

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