Sep. 23, 2009 (Business Wire) -- Fitch Ratings has affirmed Infinity Property & Casualty Corporation's (Infinity) (NASDAQ: IPCC) ratings as follows:

--Long-term Issuer Default Rating (IDR) at 'BBB+';

--$200 million senior notes due 2014 at 'BBB'.

Fitch also affirms the Insurer Financial Strength ratings of Infinity's operating subsidiaries (IFS) at 'A'. (A complete list of the subsidiaries follows at the end of this release.)

The Rating Outlook is Stable.

The ratings are based on Infinity's solid underwriting results, quality balance sheet, strong capitalization and adequate loss reserving levels. Offsetting these positives are Infinity's business concentration in the California auto market, which represents approximately 55% of net written premiums as of June 30, 2009, increased competitive landscape, and exposure to political and operating uncertainty.

Infinity is the fourth largest non-standard auto insurance company in the country. As of June 30, 2009, Infinity had total GAAP capital of $760 million. The corporation's debt-to-total capital ratio was 26%, below Fitch's 30% tolerance for the current rating category. Fitch notes that earnings based interest coverage was 9.7 times through the first half of 2009 and anticipates that the company will continue to maintain adequate interest coverage levels to support debt servicing requirements going forward.

Infinity reported a statutory underwriting combined ratio, excluding fee income, of 98.1% for the first half of 2009 compared to 100.1% for the prior year. Infinity reported net earned premium revenues of $435 million for the first half of 2009, down approximately 9.2% from the first half of 2008. Fitch anticipates that premium growth rate for Infinity will be challenged in the near-term until its customer base stabilizes.

Infinity's personal lines insurance operations utilize an extensive independent agency sales force of approximately 12,500 agents. Infinity reported GAAP consolidated assets of $1.75 billion and total shareholder equity of $560 million as of June 30, 2009.

Fitch notes that any topics that are covered in its criteria reports not specifically mentioned above are considered neutral to the rating as of the date of this publication.

Fitch has affirmed the following IFS ratings at 'A' with a Stable Outlook:

--Hillstar Insurance Co;

--Infinity Assurance Insurance Co;

--Infinity Auto Insurance Co;

--Infinity Casualty Insurance Co;

--Infinity County Mutual Insurance Co;

--Infinity General Insurance Co;

--Infinity Indemnity Insurance Co;

--Infinity Insurance Company;

--Infinity Preferred Insurance Co;

--Infinity Premier Insurance Co;

--Infinity Reserve Insurance Co;

--Infinity Safeguard Insurance Co;

--Infinity Security Insurance Co;

--Infinity Select Insurance Co;

--Infinity Specialty Insurance Co;

--Infinity Standard Insurance Co.

Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, 'www.fitchratings.com'. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures are also available from the 'Code of Conduct' section of this site.