A.M. Best Affirms Indianapolis Life "A" -Excellent- Rating.OLDWICK, N.J.--(BUSINESS WIRE)--Jan. 8, 1999--A.M. Best Co. today affirmed af·firm v. af·firmed, af·firm·ing, af·firms v.tr. 1. To declare positively or firmly; maintain to be true. 2. To support or uphold the validity of; confirm. v.intr. the "A" (Excellent) rating of Indianapolis Life Insurance Co. The rating is based on the consolidated financial strength and operating performance of the company and its subsidiaries, its good capitalization capitalization n. 1) the act of counting anticipated earnings and expenses as capital assets (property, equipment, fixtures) for accounting purposes. 2) the amount of anticipated net earnings which hypothetically can be used for conversion into capital assets. , profitable core business segments and its good position in the traditional life insurance market. It also acknowledges the strategic alliance with American United Life Insurance Co., Indianapolis, including its equity investment in the Indianapolis Life Group of Cos. Inc. and, more recently, the alliance with Fargo, N.D.-based Pioneer Mutual Life Insurance Co. Indianapolis Life's stable block of traditional life insurance in force, which is characterized char·ac·ter·ize tr.v. character·ized, character·iz·ing, character·iz·es 1. To describe the qualities or peculiarities of: characterized the warden as ruthless. 2. by good mortality and excellent persistency, is a consistent contributor to the organization's earnings. Its well-managed agency network and the fact that most of its in-force business is derived from middle-income customers in the Midwest contribute to the strong persistency of its book of business. The company's increasing earnings from its traditional whole life business has partially funded the company's expansion efforts which include a substantially greater volume of annuity business and increasing sales of universal life and term business. Although the company's capital position remains good, reflecting conservative investments and a profitable operating posture, surplus expansion is pressured by significant and increasing new business strain in Indianapolis Life's subsidiaries, which substantially offsets statutory operating gains produced at the parent company level. In addition, A.M. Best notes the heavy reliance upon reinsurance The contract made between an insurance company and a third party to protect the insurance company from losses. The contract provides for the third party to pay for the loss sustained by the insurance company when the company makes a payment on the original contract. to alleviate new business strains in its expanding fixed annuity Fixed Annuity An insurance contract in which the insurance company makes fixed dollar payments to the annuitant for the term of the contract, usually until the annuitant dies. The insurance company guarantees both earnings and principal. line of business. To further diversify diversify To acquire a variety of assets that do not tend to change in value at the same time. To diversify a securities portfolio is to purchase different types of securities in different companies in unrelated industries. its business base, achieve significant growth and provide additional source of funding for its newer initiatives, Indianapolis Life entered a strategic alliance with American United, Indiana's largest mutual insurer. A.M. Best views the affiliation positively, as it provides an opportunity for additional capital support, if necessary, and access to a broadened product portfolio. Indianapolis Life has entered a number of alliances and partnerships in recent years that significantly increased its distribution of second-to-die policies and, more recently, term life insurance. In addition, the company maintains a good universal life market presence through its subsidiary, Bankers Life Insurance Company of New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of . While these initiatives are considered positive, A.M. Best believes such actions underscore The underscore character (_) is often used to make file, field and variable names more readable when blank spaces are not allowed. For example, NOVEL_1A.DOC, FIRST_NAME and Start_Routine. (character) underscore - _, ASCII 95. the company's recognized need to supplement its traditional life insurance business and generate considerable growth in its newer businesses to achieve critical mass and meaningful economies of scale. A.M. Best further believes Indianapolis Life may need to secure more permanent financing Permanent financing Long-term financing using either debt or equity. permanent financing The long-term financing that supports a long-term asset. and reduce its heavy reliance on reinsurance for its annuity expansion. As strategic subsidiaries, A.M. Best has affirmed the "A" (Excellent) ratings of Bankers Life Insurance Company of New York, Woodbury, N.Y.; IL Annuity & Insurance Co., Boston; and Western Security Life Insurance Co., Phoenix. A.M. Best Co., established in 1899, is America's oldest and most widely recognized insurance rating and information source. |
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