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FOR IMMEDIATE RELEASE
OLDWICK, N.J. - JUNE 21, 2011 12:00 AM (EDT)
A.M. Best Co.has revised the outlook to stable from negative and affirmed the financial strength rating of A (Excellent) and issuer credit rating of "a" of Gerber Life Insurance Company (Gerber Life) (White Plains, NY).
The revised outlook reflects Gerber Life's growing premium base and improved investment performance over the past two years. The company also benefits from the financial strength of its parent company, Nestlè Holdings, Inc., as well as its use of the Gerber brand and logo. Nestlè Holdings, Inc. is a U.S. subsidiary of the international food and beverage conglomerate, Nestlè, S.A. (Nestlè) (Switzerland) [Swiss: NESN].
Gerber Life markets primarily juvenile life insurance products to individuals and, to a lesser extent, medical stop-loss products to self-insured employer groups. The company, a recognized leader in the juvenile life insurance market, sells its products nationally under the Gerber brand and logo through diverse direct-to-consumer media channels. In recent years, the company has been developing and marketing new non-juvenile life insurance products as part of its goal to provide life insurance for all life cycles.
However, Gerber Life has been challenged to grow its individual life insurance segment, as new individual life sales have declined over the last three years due to the effects of the recessionary economy. Additionally, its overall business mix and source of its operating gains has shifted in recent years, with an increased reliance on its medical stop-loss business, which can be cyclical in nature.
The principal methodology used in determining these ratings is Best's Credit Rating Methodology - Global Life and Non-Life Insurance Edition, which provides a comprehensive explanation of A.M. Best's rating process and highlights the different rating criteria employed. Additional key criteria utilized include: "Rating Health Insurance Companies"; "Risk Management and the Rating Process for Insurance Companies"; "BCAR for Life and Health Insurers"; and "Assessing Country Risk." Methodologies can be found at www.ambest.com/ratings/methodology.
Founded in 1899, A.M. Best Company is the world's oldest and most authoritative insurance rating and information source.