A.M. Best Affirms Ratings for Amica.

Business Editors

OLDWICK, N.J.--(BUSINESS WIRE)--March 15, 2002

A.M. Best Co. has affirmed the financial strength rating of A++ (Superior) for Amica Mutual Group, Providence, Rhode Island.

This rating also applies to its lead company, Amica Mutual Insurance Company, and its affiliate, Amica Lloyd's of Texas. Additionally, the financial strength rating of A (Excellent) for Amica Life Insurance Company has also been affirmed with a positive outlook.

The rating reflects Amica's superior capitalization, solid operating performance and strong market presence as one of the 60 largest property/casualty insurers in the nation. These strengths are derived from its successful low cost distribution method, consistently strong underwriting performance and well-diversified spread of risk. Amica's historically favorable loss experience reflects management's underwriting discipline, claims handling expertise and conservative loss reserving practices. Furthermore, the rating acknowledges the group's superior customer service and adherence to a mutual philosophy through the distribution of sizable policyholder dividends, which combined has strengthened overall customer satisfaction and loyalty. Amica's strong operating fundamentals and synergies are integrated into its life operations and have translated into increased life insurance sales for Amica Life. However, overall penetration levels of its property/casualty base have remained relatively flat. With no one state representing more than 15% of its business volume, Amica has successfully managed its catastrophe loss exposure through a prudent spread of risk. Further, the majority of its premiums originate in less catastrophe prone northeastern states.

These strengths are somewhat offset by intensifying competitive pressures and escalating loss costs that continue to impact the personal automobile industry. Moreover, the recent volatility in the equity market has affected the group's total returns. Subsequently, during the past five years, as a result of increased spending on technological advancements and rising administrative costs, Amica's underwriting expense ratio has risen steadily. However, Amica's advanced technology platform will ultimately enhance overall operating efficiency and service capabilities. Despite increasingly competitive market conditions and rising loss costs, Amica is well positioned to sustain its strong capitalization and improve profitability as a result of a low cost structure, loyal preferred client base and an excellent reputation for service.

A.M. Best Co., established in 1899, is the world's oldest and most authoritative insurance rating and information source. For more information, visit A.M. Best's Web site at www.ambest.com.