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FOR IMMEDIATE RELEASE
OLDWICK, N.J. - JUNE 19, 2006 12:00 AM (EDT)
A.M. Best Co. has upgraded the financial strength (FSR) rating to A- (Excellent) from B++ (Very Good) of Funeral Directors Life Insurance Company (FDLIC) (Abilene, TX). The rating outlook has been revised to stable from positive.
This rating action reflects FDLIC's successful growth in new business written, profitable statutory operating results from the core pre-need business and continued improvement in its statutory capital and surplus position. FDLIC has managed new business strain in order to maintain profitable results while it expands its presence in targeted states in the pre-need market segment. The company writes a combination of life insurance and annuity programs at various age brackets to produce stable earnings experience. A.M. Best expects that growth will continue to be managed in a profitable manner and within capital parameters for the A- (Excellent) rating.
Partially offsetting these strengths are FDLIC's relatively high expense levels in proportion to premium and earnings volatility within its life insurance and annuity business lines. In addition, the company's core pre-need market remains highly competitive and vulnerable to low interest rates.
In addition, A.M. Best has affirmed the FSR of B+ (Very Good) of Kentucky Funeral Directors Life Insurance Company. The outlook for this rating is stable.
The action reflects the company's adequate capitalization but modest new business production and earnings, operating as the Kentucky marketing arm of FDLIC.
For Best's Ratings, an overview of the rating process and rating methodologies, please visit Best's Rating Center.
A.M. Best Co., established in 1899, is the world's oldest and most authoritative insurance rating and information source.