AM Best Upgrades Illinois Casualty and Lebanon Valley to A

AM Best has upgraded the Financial Strength Rating of Illinois Casualty Company (ICC) and Lebanon Valley Insurance Company (LV) to A (Excellent) from A- (Excellent), the rating agency announced.

The Long-Term Issuer Credit Ratings (Long-Term ICRs) of both insurers moved to "a" (Excellent) from "a-" (Excellent) in the same action. The outlook on those ratings was revised to stable from positive.

ICC and LV are domiciled in Rock Island, Illinois. The two carriers are part of a four-company structure that AM Best tracks as Mutual Capital Insurance Group.

What did AM Best also affirm?

Concurrently with the upgrades, AM Best affirmed the FSR of A (Excellent) and the Long-Term ICRs of "a" (Excellent) for two other members of the group:

• Tuscarora Wayne Insurance Company (TW)
• Keystone National Insurance Company, TW's affiliate

The outlook assigned to those affirmed ratings is stable. TW and Keystone National Insurance Company are domiciled in Wyalusing, Pennsylvania.

AM Best refers to all four companies collectively as Mutual Capital Insurance Group, or simply the group.

Why were ICC and Lebanon Valley upgraded?

The rating agency anchored its assessment in four pillars. The ratings reflect Mutual Capital Insurance Group's balance sheet strength, which AM Best assesses as very strong, as well as its:

• adequate operating performance
• neutral business profile
• appropriate enterprise risk management (ERM)

The upgrades of ICC and LV have a specific trigger. AM Best said the rating actions follow the recent regulatory approval of the intercompany pooling agreement between TW, LV and ICC, effective July 1, 2026.

That structure is the core of the decision. AM Best said the rating upgrades are based on its expectation that the business profiles of ICC and LV will be enhanced as pooled members of the group.

In plain terms: once the three carriers pool their business next summer, AM Best expects ICC and LV to operate on stronger footing than they did as standalone entities.

What changes on July 1, 2026?

The pooling agreement is the event to watch. It links TW, LV and ICC under a shared structure, and it earned regulatory approval before this ratings action landed.

For ICC and LV, the shift moves them from a positive outlook — a ratings trajectory — to actual upgrades with a stable outlook. That combination signals AM Best considers the improvement earned rather than pending.

For policyholders of either carrier, the upgrade to A (Excellent) reflects a stronger claims-paying capacity assessment as the July 1, 2026 pooling start date approaches.