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A.M. Best Upgrades Credit Ratings of Lewer Life Insurance CompanyA.M. Best has upgraded the Financial Strength Rating to B+ (Good) from B (Fair) and the Long-Term Issuer Credit Rating (Long-Term ICR) to "bbb-" from "bb+" of Lewer Life Insurance Company (Lewer Life) (Kansas City, MO). The outlook of these Credit Ratings (ratings) has been revised to stable from positive. The ratings reflect Lewer Life's balance sheet strength, which A.M. Best categorizes as very strong, as well as its adequate operating performance, very limited business profile and marginal enterprise risk management. The rating upgrades reflect Lewer Life's long-established niche of more than 25 years in the student health insurance marketplace, favorable operating results and strongest risk-adjusted capitalization, as measured by Best's Capital Adequacy Ratio. Lewer Life generates the majority of its net premium revenue from reinsuring international student insurance business, which is underwritten by two carriers and marketed and administered by its affiliate, The Lewer Agency, a nationally licensed managing general agency and a third-party administrator that has provided favorable underwriting. Lewer Life has reported increased levels of profitability over the past two years as it strategically exited from its relationship with a single carrier and negotiated an arrangement with two carriers offering Affordable Care Act-exempt products, which somewhat mitigate concentration and regulatory risks. Net income has been the primary contributor to capital growth over the past two years. In addition, the company has been extended a sizabe line of credit and has no outstanding balance. However, the absolute level of capital and surplus remains modest, the company remains very dependent on its reinsurance relationships and the vast majority of premium revenue was received from two ceding companies. Furthermore, Lewer Life's future expansion potential may be challenged as the number of international students in the United States has not grown in recent years, pressured by economic and political developments. This press release relates to Credit Ratings that have been published on A.M. 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 A.M. Best's Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Understanding Best's Credit Ratings. For information on the proper media use of Best's Credit Ratings and A.M. Best press releases, please view Guide for Media - Proper Use of Best's Credit Ratings and A.M. Best Rating Action Press Releases. A.M. Best is the world's oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com. Copyright © 2018 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.
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