| [February 14, 2012] |
 |
A.M. Best Affirms Ratings of Life Insurance Company of Alabama
OLDWICK, N.J. --(Business Wire)--
A.M. Best Co. has affirmed the financial strength rating of B+
(Good) and issuer credit rating of "bbb-" of Life Insurance Company
of Alabama (LICOA) (Gadsden, AL). The outlook for both ratings is
stable.
The rating affirmations reflect LICOA's established niche marketing of
supplemental accident and health and life insurance products primarily
via worksite sales, relatively stable profitability and significant
reduction in its liability exposure resulting from the settlement of two
class-action lawsuits in 2011.
Offsetting rating factors include LICOA's concentration of business in
the cancer insurance market, continuing litigation expenses and its
business concentration in Alabama, Tennessee, Mississippi and Georgia.
LICOA, licensed in 10 southeastern states and Oklahoma, is a small,
closely held public company that has provided supplemental insurance
roducts to employer groups and individuals since 1952.
Future positive rating actions could occur if LICOA significantly grows
its non-cancer lines of business while maintaining profitability,
sizably reduces litigation expenses and appreciably grows business
beyond its core four state marketing territory. Alternatively, negative
rating actions could occur if profitability trends downward or if its
sufficient capital and surplus level materially deteriorates.
The methodology used in determining these ratings is Best's Credit
Rating Methodology, which provides a comprehensive explanation of A.M.
Best's rating process and contains the different rating criteria
employed in the rating process. Key criteria utilized include: "Rating
Health Insurance Companies"; "Risk Management and the Rating Process for
Insurance Companies"; "BCAR for Life/Health Insurers"; and "Assessing
Country Risk." Best's Credit Rating Methodology can be found at www.ambest.com/ratings/methodology.
Founded in 1899, A.M. Best Company is the world's oldest and most
authoritative insurance rating and information source. For more
information, visit www.ambest.com.
Copyright © 2012 by A.M. Best Company, Inc. ALL RIGHTS
RESERVED.
[ Back To TMCnet.com's Homepage ]
|
TMCnet LOGIN
Webinars
