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KBRA Publishes Rating Report for Landmark Life Insurance CompanyOn September 28, 2018, Kroll Bond Rating Agency (KBRA) assigned an insurance financial strength rating (IFSR) of BBB- with a Stable Outlook to Landmark Life Insurance Company (Landmark Life). Landmark Life, founded in 1964, is a final expense life insurance and annuity company and third-party administrator. The rating reflects Landmark Life's consistent operating profitability, solid balance sheet, long-standing agency relationships, and steady revenue streams from its final expense and third-party administration (TPA) businesses. Landmark Life is a Texas-domiciled stipulated premium life insurance company licensed in 34 states, with most of its premium from Texas. Its two main lines offer complementary characteristics - final expense is Landmark Life's main product, comprising most of its revenue, while TPA services offer a non-capital-intensive way to grow. Landmark Life possesses a solid balance sheet with sound risk-adjusted capitalization, conservative reserving practices and an above-average ratio of capital and surplus to liabilities. KBRA notes that, relative to final expense peer companies, Landmark Life's current overall persistency is excellent at 74% and its mortality experience is well above-average. Moreover, the company is a member of the Federal Home Loan Bank of Dallas, which it utilizes for back-up liquidity. Offsetting these credit strengths is Landmark Life's TPA client concentration as over 75% of fee income (and 21% of total revenue) comes from administering blocks from the Liberty Bankers Insurance Group. Although KBRA believes it is unlikely, the loss of this client would have a significant impact on the company's results. Additionally, Landmark Life's market share is modest, the final expense arena is quite competitive, and the company's expense ratio remains higher than peers. A portion of Landmark Life's asset portfolio is invested in mortgag loans - 6% of total investments and nearly half of total adjusted capital. These loans are fairly concentrated geographically (within fifty miles of company headquarters) and by borrower (only 19 borrowers). This is partly mitigated by a low loan-to-value at origination of roughly 75% and overall loan-to-value for the portfolio of about 54% at year-end 2017. The rating is based on KBRA's Global Insurer & Insurance Holding Company Rating Methodology published on October 10, 2017. Please click here to access the full report or visit www.kbra.com. CONNECT WITH KBRA
Twitter About KBRA and KBRA Europe KBRA is a full service credit rating agency registered with the U.S. Securities and Exchange Commission as an NRSRO. In addition, KBRA is designated as a designated rating organization by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus, is recognized by the National Association of Insurance Commissioners as a Credit Rating Provider, and is a certified Credit Rating Agency (CRA) by the European Securities and Markets Authority (ESMA). Kroll Bond Rating Agency Europe Limited is registered with ESMA as a CRA. View source version on businesswire.com: https://www.businesswire.com/news/home/20181023006118/en/ |
