Best’s News & Research Service - November 06, 2019 02:56 PM (EST)
AM Best Affirms Credit Ratings of Fidelity & Guaranty Life Holdings, Inc. and Its Key Life/Health Subsidiaries
- November 06, 2019 02:56 PM (EST)
Oldwick //BestWire// - AM Best has affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of “a-” of the key life/health subsidiaries of Fidelity & Guaranty Life Holdings, Inc. (FGLH) (Delaware). (See below for a detailed listing of these companies.) These subsidiaries are referred to collectively as Fidelity & Guaranty Life Group. In addition, AM Best has affirmed the Long-Term ICR of “bbb-” and the Long-Term Issue Credit Rating (Long-Term IR) of “bbb-” of FGLH. The outlook of these Credit Ratings (ratings) is stable. (See below for details of the Long-Term IR.)
The ratings reflect Fidelity & Guaranty Life Group’s balance sheet strength, which AM Best categorizes as strong, as well as their adequate operating performance, neutral business profile and appropriate enterprise risk management (ERM).
The group’s ratings primarily reflect its strong risk-adjusted capitalization, solid financial flexibility and its strong investment management capabilities. FGLH’s operating companies have generally reported statutory profitability and maintain a competitive position in the fixed-indexed annuity (FIA) market. Although reported earnings are generally strong, an operating loss was reported in the fourth quarter of 2018 after significant reinsurance activity. AM Best expects that this reported loss is a one-time event, and notes that pre-tax statutory earnings through June 30, 2019 were $142.4 million. Partially offsetting these positive rating factors is the above-average risk profile in the company’s investment portfolio, its significant reliance on FIA sales and the high level of competition in the FIA market. AM Best notes that despite exposure to some heightened investment risk, FGLH’s investment management capabilities are viewed as strong as the group benefits from its relationship with Blackstone Insurance Solutions Group, which provides FGLH with access to Blackstone’s resources.
The FSR of A- (Excellent) and the Long-Term ICRs of “a-” have been affirmed with stable outlooks for the following key life/health subsidiaries of Fidelity & Guaranty Life Holdings, Inc.
- Fidelity & Guaranty Life Insurance Company
- Fidelity & Guaranty Life Insurance Company of New York
- F&G Reinsurance Ltd
The following Long-Term IR of FGLH has been affirmed with a stable outlook:
— “bbb-” on $550 million 5.5% senior unsecured notes, due 2025
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 an exclusive focus on the insurance industry.