AM Best has assigned a Long-Term Issue Credit Rating of “bbb+” (Good) to the $300 million, 7% surplus notes, due October 2064, issued by Farmers Insurance Exchange (Woodland Hills, CA). The outlook assigned to this Credit Rating (ratings) is stable.
The proceeds from the surplus notes issuance are expected to be used for general purposes, and the financial leverage will remain within AM Best’s guidelines for the company’s current rating. Additionally, the company’s liquidity is considered sufficient to service the debt.
Subject to certain restrictions, Farmers Insurance Exchange may redeem, in whole or in part, the surplus note in two different scenarios. The first allows Farmers Insurance Exchange to call it during the three-month period prior to, and including, Oct. 15, 2054 (the par call period), at a redemption price equal to 100% of the principal amount of the note being redeemed. The second allows Farmers Insurance Exchange to call the note at any time on any date that is not within the par call period, at a redemption price equal to the make-whole redemption price, plus accrued and unpaid interest. The surplus notes will mature on Oct. 5, 2064.
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.
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