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AM Best Revises Outlooks to Stable for Members of Philadelphia Contributionship Group

AM Best has revised the outlooks to stable from negative and affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Ratings of “a-” (Excellent) of Germantown Insurance Company, The Philadelphia Contributionship Insurance Company and The Philadelphia Contributionship for the Insurance of Houses from Loss by Fire, Inc., which are members of the Philadelphia Contributionship Group (the Contributionship). All companies are domiciled in Philadelphia, PA.

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

The stable outlooks reflect several corrective actions taken to refine the Contributionship’s business profile, which, as a result, have gained traction and reduced severity in operating results over the past few years. Recent actions include aggressive rate increases, insurance to value measures, coastal mitigation strategies and comprehensive agency management efforts. Pricing sophistication has been enhanced further through predictive modeling and use of third-party data. Management diligently reviewed and redefined its distribution partnerships in an effort to align values and goals, which resulted in a considerable reduction to agents representing the group. Efforts to improve the underlying risks of the portfolio support the neutral business profile assessment, which also reflects the organization’s well-established presence within the Mid-Atlantic region having a niche focus on underserved urban and surrounding suburban markets.

Additionally, the stable outlooks reflect AM Best’s expectation that the Contributionship will maintain very strong overall balance sheet strength supported by the strongest level of risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR), and sustained improvement in operating performance as compared with older years. Performance is expected to report moderate volatility given the group’s significant property exposure that subjects results to weather-related events and severe fire losses, partially mitigated by a prudent reinsurance program. Despite such volatility, the level of severity has dampened since 2019 due to management’s ongoing initiatives.

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

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