Press Release - NOVEMBER 01, 2019

AM Best Affirms Credit Ratings of MetLife, Inc. and Its Subsidiaries


CONTACTS:
 Kate Steffanelli
Senior Financial Analyst—L/H
+1 908 439 2200, ext. 5063
kate.steffanelli@ambest.com

Jeffrey Stary
Financial Analyst—P/C
+1 908 439 2200, ext. 5689
jeffrey.stary@ambest.com
Christopher Sharkey
Manager, Public Relations
+1 908 439 2200, ext. 5159
christopher.sharkey@ambest.com

Jim Peavy
Director, Public Relations
+1 908 439 2200, ext. 5644
james.peavy@ambest.com

FOR IMMEDIATE RELEASE

OLDWICK - NOVEMBER 01, 2019
AM Best has affirmed the Financial Strength Rating (FSR) of A+ (Superior) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of “aa-” of the Metropolitan Life Insurance Company (MLIC) (New York, NY) and Metropolitan Tower Life Insurance Company (Lincoln, NE) (collectively referred to as MetLife Insurance Group). Additionally, AM Best has affirmed the Long-Term ICR of “a-” and the Long- and Short-Term Issue Credit Ratings (Long-Term IR; Short-Term IR) of MetLife, Inc. (MetLife) (headquartered in New York, NY) [NYSE: MET]. The outlook of these Credit Ratings (ratings) is stable. (See link below for a detailed listing of the companies and ratings.)

Concurrently, AM Best has affirmed the FSR of A (Excellent) and the Long-Term ICRs of “a+” of MetLife’s property/casualty companies, consisting of Metropolitan Property and Casualty Insurance Company and seven fully reinsured subsidiaries, as well as Metropolitan Group Property and Casualty Insurance Company (both domiciled in Warwick, RI) (collectively referred to as MetLife Auto & Home Group). The outlook of these ratings is positive.

The ratings of MetLife Insurance Group reflect its balance sheet strength, which AM Best categorizes as strong, as well as its strong operating performance, very favorable business profile and appropriate enterprise risk management (ERM).

The rating affirmations reflect the organization’s strong, defensible market position in its core lines of business and the diversity of its products and geographic markets, as well as a reduced product risk profile. MetLife holds leading market positions in mature and emerging markets, and the group continues to generate profitable revenue growth, which combined with its steady stream of net investment income, has resulted in consistent operating metrics on a statutory and GAAP basis. Favorable premium growth spans across core product lines with the Group Benefits segment reporting favorable trends in its voluntary lines and a continued stream of pension risk transfer transactions within its Retirement and Income Solutions segment. The strong balance sheet assessment is supported by qualitative considerations of its reserve profile and a consolidated view of capital adequacy, which is enhanced by the liquidity and financial flexibility of the holding company, as MetLife maintains over $3 billion in cash and liquid assets. Financial leverage is approximately 25%, and interest coverage (excluding holding company liquidity) is slightly below similarly rated peers at 6.6 times.

Operating performance is viewed as strong, with the group focused on higher margin product lines with lower volatility of returns, expense efficiencies and double-digit GAAP returns on equity that have been partially enhanced through share repurchase programs. AM Best views ERM as appropriate, with material weaknesses in internal controls identified as of Dec. 31, 2017, fully remediated as of Dec. 31, 2018, along with enterprise-wide training on risk culture implemented for its employees.

The ratings of MetLife Auto & Home Group reflect its balance sheet strength, which AM Best categorizes as very strong, as well as its adequate operating performance, favorable business profile and appropriate ERM.

The ratings of MetLife Auto & Home Group recognize the companies’ strong risk-adjusted capitalization, favorable operating performance and a multiple-channel distribution network that includes MetLife’s products and programs, as well as extensive market expertise. Additional positive rating factors include the property/casualty companies’ national geographic diversification and the marketing advantage derived from MetLife’s established brand-name recognition. The ratings further acknowledge management’s focused operating strategy that allows the group to consistently generate capital from operating earnings through disciplined underwriting and strong investment returns. Finally, the ratings recognize the financial strength and support provided by MetLife.

The positive outlooks reflect a trend of favorable underwriting performance that consistently has outperformed the composite on a five- and 10-year basis. It further reflects AM Best’s expectation that MetLife Auto & Home Group’s operating performance may continue to drive organic surplus growth. Partially offsetting these positive rating factors are MetLife Auto & Home Group’s moderately elevated underwriting leverage, its exposure to severe weather-related events and a dividend policy that constrains surplus growth.

A complete listing of MetLife’s FSRs, Long-Term ICRs and Long- and Short-Term IRs also is available.

This press release relates to Credit Ratings that have been published on AM Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Understanding Best’s Credit Ratings. For information on the proper media use of Best’s Credit Ratings and AM Best press releases, please view Guide for Media - Proper Use of Best’s Credit Ratings and AM Best Rating Action Press Releases.

AM Best is a global rating agency and information provider with a unique focus on the insurance industry.


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