[January 24, 2013]

A.M. Best Revises Outlook to Stable for Wayne Mutual Insurance Company

A.M. Best Co. has revised the outlook to stable from negative and affirmed the financial strength rating of B++ (Good) and issuer credit rating of "bbb" of Wayne Mutual Insurance Company (Wayne) (Wooster, OH).

The revised outlook reflects Wayne's improved operating results and adequate level of risk-adjusted capitalization, despite frequent and severe weather-related events that occurred in the company's operating territory. The company has adhered to disciplined underwriting practices over several years while maintaining strong relationships with its long-standing agency network. The revised outlook further recognizes A.M. Best's expectation that the company's operating performance and capitalization will continue to improve as management's underwriting and operational strategies are fully realized.

As a property predominant writer with a geographic concentration in Ohio, Wayne's earnings remain susceptible o localized and severe weather-related events as well as changes in the regulatory environment and increasingly competitive market conditions. Underwriting profitability remains one of management's key objectives, driven by adequate pricing, continued growth in small commercial business as well as technological and product enhancements.

Factors that could trigger negative rating actions include above average premium growth or significant deterioration in Wayne's operating performance causing a material decline in its risk-adjusted capitalization.

The methodology used in determining these ratings is Best's Credit Rating Methodology, which provides a comprehensive explanation of A.M. Best's rating process and contains the different rating criteria employed in the rating process. Key criteria utilized include: "Risk Management and the Rating Process for Insurance Companies"; "Catastrophe Analysis in A.M. Best Ratings"; and "Understanding BCAR for Property/Casualty Insurers." Best's Credit Rating Methodology can be found at www.ambest.com/ratings/methodology.

Founded in 1899, A.M. Best Company is the world's oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com.

Copyright © 2013 by A.M. Best Company, Inc. ALL RIGHTS RESERVED.

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