Best’s News & Research Service - January 26, 2024 12:25 PM (EST)
AM Best Revises Outlooks to Stable for LifeMap Assurance Company; Affirms Credit Ratings of USAble Life
- January 26, 2024 12:25 PM (EST)
Oldwick //BestWire// - AM Best has revised the outlooks to stable from positive and affirmed the Financial Strength Rating (FSR) of A- (Excellent) and the Long-Term Issuer Credit Rating (Long-Term ICR) of “a-” (Excellent) of LifeMap Assurance Company (LifeMap) (Portland, OR). Additionally, AM Best has affirmed the FSR of A (Excellent) and the Long-Term ICR of “a” (Excellent) of USAble Life (USAL) (Little Rock, AR). The outlook of these Credit Ratings (ratings) is stable.
The ratings of LifeMap reflect its balance sheet strength, which AM Best assesses as strongest, as well as its marginal operating performance, limited business profile and appropriate enterprise risk management (ERM).
The rating affirmation of LifeMap reflects its balance sheet strength assessment at the strongest level, which is based on its strongest level of risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR), favorable liquidity metrics and modest investment risk. LifeMap’s BCAR score has remained stable over the past year due to retained earnings offsetting unrealized capital losses. Invested assets are primarily investment-grade fixed income securities with a moderate amount of equity holdings. LifeMap became a sister company to USAble Life in 2022 with common ownership by Life and Specialty Ventures, LLC (LSV).
The revision of LifeMap’s outlook to stable from positive is based on LSV’s plan to transition certain renewal business and all new sales for LifeMap to affiliates, as such premium revenues will continue to decline and operating performance for remaining business is uncertain. Nevertheless, LifeMap has considerable excess capital that can absorb any potential adverse operating results. LifeMap’s ratings take into consideration its strategic role to LSV and implicit capital support of LifeMap by LSV and its controlling owners: Blue Cross and Blue Shield of Florida, Inc d.b.a. Florida Blue, USAble Mutual Insurance Company, and Cambia Health Solutions, Inc. (Cambia).
The ratings of USAble Life reflect its balance sheet strength, which AM Best assesses as strongest, as well as its adequate operating performance, limited business profile and appropriate ERM.
The rating affirmation of USAble Life reflects its balance sheet strength assessment being at the strongest level based on its strongest level of risk-adjusted capitalization, as measured by BCAR, in addition to maintaining sufficient liquidity metrics and modest investment risk. Invested assets are primarily investment-grade fixed income securities with a moderate amount of equity holdings. The company’s operating performance is adequate with premium growth reported over the past three years and through third quarter of 2023; operating earnings turned favorable in 2023 after reporting losses in the past two years. Premium growth is attributed mostly to increased dental sales and the inclusion of business from its newest strategic partner, Cambia. The company’s operating results improved as the drag on results from COVID-related life and accident and health claims has dissipated. USAble Life supports a portfolio of supplemental health, life and disability products for 16 Blue plan partners and provides dental benefits in seven states with five Blue plan partners.
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.