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A.M. Best Affirms Ratings of American Family Insurance Group; Assigns Issuer Credit Ratings.

OLDWICK, N.J. -- A.M. Best Co. has affirmed the financial strength rating (FSR) of A (Excellent) and assigned an issuer credit rating (ICR) of "a+" to American Family Insurance Group (American Family) and its property/casualty subsidiaries. Additionally, A.M. Best has affirmed the FSR of A (Excellent) and assigned an ICR of "a" to American Family Life Insurance Company (AFLIC). Concurrently, A.M. Best has affirmed the debt rating of AMB-1 of American Family Financial Services, Inc.'s commercial paper program. All companies are domiciled in Madison, WI. All ratings have a stable outlook.

The ratings of American Family are based on its excellent risk-adjusted capitalization, improved underwriting performance and well-established regional market presence as a leading personal lines insurer in the Midwest. These positive rating factors are derived from American Family's increased rates, focused operating philosophy and competitive expense structure achieved through its exclusive agency distribution system. Offsetting these strengths is the group's susceptibility to weather-related losses and competitive market conditions.

AFLIC's ratings recognize its integral role as the life insurance member of American Family and its focus on providing life insurance and financial products to the group's customer base. AFLIC's ratings also reflect its diverse product portfolio, strong marketing and distribution presence in the Midwest, overall positive net operating performance and favorable risk-adjusted capitalization on a stand-alone basis. Offsetting these strengths is the company's exposure to disintermediation risk, the challenges to sustain life insurance sales growth through its property/casualty-oriented agency sales force, increase the penetration of its parent company's customer base and improve the operating performance of its annuity businesses.

The FSR of A (Excellent) has been affirmed and an ICR of "a+" has been assigned to American Family Insurance Group and its following property/casualty subsidiaries:

--American Family Mutual Insurance Company

--American Family Insurance Company

--American Standard Insurance Company of Ohio

--American Standard Insurance Company of Wisconsin

The FSR of A (Excellent) has been affirmed and an ICR of "a" has been assigned to American Family Life Insurance Company.

The following debt rating has been affirmed:

American Family Financial Services, Inc.--

--AMB-1 on commercial paper program

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.

For current Best's Ratings, independent data and analysis on more than 3,000 individual property/casualty companies and A.M. Best groups, please visit www.ambest.com/pc.

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.
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Publication:Business Wire
Geographic Code:1USA
Date:Jan 10, 2006
Words:435
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