NSEC National Security Group Inc

A.M. Best Co. has affirmed the financial strength rating (FSR) of B++ (Good) and issuer credit ratings (ICR) of �bbb� of National Security Group (National Security) and its member, National Security Fire and Casualty Company. Additionally, A.M. Best has affirmed the FSR of B+ (Good) and ICR of �bbb-� of National Security�s wholly owned subsidiary, Omega One Insurance Company, Inc (Omega One). Concurrently, A.M. Best has affirmed the FSR of B (Fair) and ICR of �bb� of the life/health company, National Security Insurance Company. A.M. Best also has affirmed the ICR of �bb� of the parent company of the affiliates, The National Security Group, Inc. (NASDAQ: NSEC). The outlook for all ratings is stable. All of the insurance companies are domiciled in Elba, AL. The ratings of National Security reflect its adequate risk-adjusted capitalization, improved operating trends and well-established niche position as a provider of dwelling/fire coverage. However, somewhat offsetting these positive rating factors is the group�s geographic and product concentration in the Gulf Coast states, which subjects National Security�s earnings and surplus to substantial hurricane exposure as well as competitive pressures. The ratings of Omega One acknowledge its low underwriting leverage and favorable operating performance. Partially offsetting these positive rating factors is the company�s limited business profile that leaves it susceptible to severe weather-related losses. The ratings of National Security Insurance Company reflect the recent decline in its capital and surplus, fluctuating operating results and limited geographic profile. Partially offsetting these rating factors are the company�s favorable level of risk-adjusted capitalization, recent � albeit modest � growth of new premium and improved level of persistency on its ordinary life line. For Best�s Ratings, an overview of the rating process and rating methodologies, please visit www.ambest.com/ratings. Founded in 1899, A.M. Best Company is a global full-service credit rating organization dedicated to serving the financial and health care service industries, including insurance companies, banks, hospitals and health care system providers. For more information, visit www.ambest.com.