A.M. Best Affirms Ratings of State Auto Insurance Companies

  
    
  
  
    
      A.M. Best Co. has affirmed the financial strength rating (FSR) of 
      A+ (Superior) and issuer credit ratings (ICR) of “aa-” 
      of State Auto Insurance Companies (State Auto) and its 
      members. A.M. Best also has affirmed the ICR of “a-” 
      and debt rating of “a-” 
      on $100 million 6.25% senior unsecured notes issued by State Auto 
      Financial Corporation [NASDAQ: STFC]. 
      All the above named companies are domiciled in Columbus, OH. The outlook 
      for all ratings is stable. (See below for a detailed listing of the 
      companies and ratings.)
    
    
      The ratings reflect State Auto’s strong 
      capitalization, favorable operating performance and excellent regional 
      market franchise. These attributes reflect its long-standing regional 
      market presence, well-established agency relationships, strong brand 
      name recognition, diversified product offerings and adherence to sound 
      underwriting fundamentals.
    
    
      Somewhat offsetting these positive rating factors is the group’s 
      exposure to localized storms and an earthquake stemming from the New 
      Madrid fault in the Midwest, along with hurricane activity in the 
      southeastern United States. In addition, State Auto has debt servicing 
      requirements due to the above mentioned debt issuance, which could put a 
      strain on future earnings. However, State Auto has continued to 
      emphasize disciplined underwriting, pricing and claims processes. As a 
      result of this strategy, State Auto has reported favorable operating 
      results in each of the past five years.
    
    
      The FSR of A+ (Superior) and the ICRs of “aa-” 
      have been affirmed for State Auto Insurance Companies and its 
      following members:
    
    
      
        State Auto Florida Insurance Company
      
      
        Patrons Mutual Insurance Company of Connecticut
      
      
        Litchfield Mutual Fire Insurance Company
      
      
        Beacon National Insurance Company
      
      
        Beacon Lloyds Insurance Company
      
      
        Farmers Casualty Insurance Company
      
      
        Milbank Insurance Company
      
      
        State Auto Property and Casualty Insurance Company
      
      
        State Auto Insurance Company of Wisconsin
      
      
        State Auto National Insurance Company
      
      
        State Automobile Mutual Insurance Company
      
      
        State Auto Insurance Company of Ohio
      
      
        Meridian Citizens Mutual Insurance Company
      
      
        Meridian Security Insurance Company
      
    
    
      The ICR of “a-” 
      has been affirmed for State Auto Financial Corporation.
    
    
      The following debt rating has been affirmed:
    
    
      State Auto Financial Corporation—
    
    
      -- “a-” on $100 
      million 6.25% senior unsecured notes, due 2013
    
    
      For Best’s Debt Ratings, all other 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.