TEXT-S&P cuts Tennessee Farmers Mutual Insurance Co

Sept 18 - Rating Action
On Aug. 31, 2012, Standard & Poor's Ratings Services lowered its counterparty
credit and financial strength ratings on Tennessee Farmers Mutual Insurance
Co. and Tennessee Farmers Assurance Co. (collectively Tennessee Farmers) to
'BBpi' from 'BBBpi'.

Rationale
The downgrade of Tennessee Farmers reflects the deterioration in the company's
operating performance. Since 2008, the company has not realized underwriting
profitability, and for 2011 the trend worsened with a net underwriting loss of
$268 million. Although the significant losses in 2011 may be widely attributed
to increased storm activity, they come as part of a broader deterioration in
operating performance that preceded the year. In addition, the company's 100%
geographic concentration in Tennessee makes it more susceptible to severe
weather-related events in the region. The group's strong capitalization
partially offsets the negative factors.

Tennessee Farmers, which markets its insurance products primarily through
direct marketing, commenced operations in 1948.

Related Criteria And Research
Ratings Bearing A "pi" Subscript: Methodology And Assumptions, Feb. 9, 2011

Ratings List
Downgrade To From
Tennessee Farmers Mutual Insurance Co. (Unsolicited Ratings)
Tennessee Farmers Assurance Co. (Unsolicited Ratings)
Counterparty Credit Rating
Local Currency BBpi BBBpi
Financial Strength Rating
Local Currency BBpi BBBpi

This unsolicited rating(s) was initiated by Standard & Poor's. It may be based
solely on publicly available information and may or may not involve the
participation of the issuer. Standard & Poor's has used information from
sources believed to be reliable based on standards established in our Credit
Ratings Information and Data Policy but does not guarantee the accuracy,
adequacy, or completeness of any information used.

Complete ratings information is available to subscribers of RatingsDirect on
the Global Credit Portal at www.globalcreditportal.com. All ratings affected
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