Moody’s lifts American Financial view to stable

Moody’s Investors Service said it affirmed the Baa1 senior debt rating for American Financial Group, Inc., the A1 insurance financial strength ratings of its property and casualty operations led by Great American Insurance Co., and the A2 insurer financial strength rating of life insurance subsidiary, Great American Life Insurance Co.

The outlook for these ratings also was revised to stable from negative, reflecting good underwriting profitability and capital levels, Moody’s said.

The company has made significant progress in managing the southeastern United States business acquired from Liberty Mutual in 2014, Moody’s said.

The ratings also consider the group’s long-standing track record and underwriting expertise as a lead specialty-market underwriter across a diverse array of niche commercial lines segments, consistently strong profitability, low exposure to catastrophe volatility, good financial leverage metrics and a performance-driven compensation structure, the agency said.

These strengths are tempered by Great American Life’s high underwriting leverage, moderate exposure to adverse reserve development in its commercial casualty portfolio and elevated reinsurance recoverables compared to peers, Moody’s said.

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