Best’s News & Research Service - September 08, 2022 09:13 AM (EDT)
AM Best Revises Outlooks to Positive for The Union Labor Life Insurance Company
- September 08, 2022 09:13 AM (EDT)
Oldwick //BestWire// - AM Best has revised the outlooks to positive from stable and affirmed the Financial Strength Rating A- (Excellent) and the Long-Term Issuer Credit Rating of “a-” (Excellent) of The Union Labor Life Insurance Company (ULL), domiciled in Silver Spring, MD.
The Credit Ratings (ratings) reflect ULL’s balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management (ERM).
The positive outlooks represent the improvement in ULL’s business profile in recent years. The company continues to benefit from its strong market position within the Taft-Hartley market, specifically within the medical stop loss market, and consistently maintains high policy persistency rates across its lines of business. ULL has diversified operations with its traditional insurance operations, fee income from separate accounts, and favorable performance from its affiliated property/casualty insurance captive. Additionally, the company has a nationwide presence in the United States; however, premium concentration is slightly above the industry.
The company’s balance sheet strength assessment continues to be supported by its strongest risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR), complemented by its conservative allocation of invested assets and high quality reinsurance. ULL’s operating performance is underpinned by consistently favorable, albeit fluctuating, bottom-line results driven by disciplined underwriting, expense management, and stable investment income. AM Best notes that statutory earnings have been impacted negatively by higher-than-expected mortality and morbidity in the group life and stop loss lines of business over the past two years as a result of the COVID-19 pandemic. However, AM Best believes that earnings will remain positive and should continue to improve as the impacts from the pandemic begin to wane. The company also benefits from an extensive and developed ERM framework and continues to enhance the program.
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 Performance Assessments, 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.