Best’s News & Research Service - August 11, 2021 01:39 PM (EDT)
AM Best Withdraws Credit Ratings of Union Security Life Insurance Company of New York
- August 11, 2021 01:39 PM (EDT)
Oldwick //BestWire// - AM Best has removed from under review with developing implications and downgraded the Financial Strength Rating to B+ (Good) from B++ (Good) and the Long-Term Issuer Credit Rating to “bbb-” (Good) from “bbb” (Good) of Union Security Life Insurance Company of New York (New York, NY). The outlook assigned to these Credit Ratings (ratings) is negative. Concurrently, AM Best has withdrawn these ratings as the company has requested to no longer participate in AM Best’s interactive rating process.
The ratings reflect Union Security Life Insurance Company of New York’s balance sheet strength, which AM Best assesses as adequate, as well as its marginal operating performance, limited business profile and appropriate enterprise risk management.
The rating downgrades reflect the diminished strategic importance of Union Security Life Insurance Company of New York to its parent, Assurant Inc., after the sale of its preneed business to CUNA Mutual Group.
This business, which was previously primarily the New York marketing arm of Assurant Employee Benefits that was sold to Sun Life Financial Inc. in 2016, is now only actively marketing a small amount of financial services business for Assurant’s Global Lifestyle Segment. Additionally, there is extremely high reinsurance leverage due to the sale of several large blocks of business via reinsurance backed by reinsurance trusts. The absolute level of capital has declined considerably from historical levels since the end of 2015, as capital formerly backing the Employee Benefits Business was released.
The negative outlooks reflect Union Security Life Insurance Company of New York’s contracting business profile, which AM Best assesses as limited.
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 Guide to Best’s Credit Ratings. For information on the proper use of Best’s Credit Ratings, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.
AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City.