A.M. Best Affirms Jefferson-Pilot's Financial Strength and Debt Ratings.OLDWICK, N.J. -- A.M. Best Co. has affirmed the financial strength rating of A++ (Superior) of Jefferson-Pilot Corporation's (Jefferson-Pilot) (NYSE NYSE See: New York Stock Exchange : JP) (Greensboro, NC) principal life insurance and annuity companies, which include Jefferson-Pilot Life Insurance Company (Greensboro, NC), Jefferson Pilot Financial Insurance Company (Omaha, NE) and Jefferson Pilot LifeAmerica Insurance Company (Florham Park, NJ). Additionally, A.M. Best has affirmed the issuer credit rating of "aa-" of Jefferson-Pilot. A.M. Best has also affirmed the debt ratings of Jefferson-Pilot's outstanding debt securities. The outlook for all ratings is stable. The ratings reflect Jefferson-Pilot's consistently strong operating performance, sound capital management, ample fixed charge coverage, solid capitalization and high-quality investment portfolio. In addition, Jefferson-Pilot's asset/liability management Asset/Liability Management A technique companies employ in coordinating the management of assets and liabilities so that an adequate return may be earned. Also known as "surplus management. expertise and strong cash flows provide excellent liquidity. The company is a leading provider of fixed universal life products and maintains a top 20 ranking in both 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. and variable universal life insurance The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. sales. Jefferson-Pilot generates the majority of earnings from its core individual life and fixed-annuity lines of business, supplemented by its growing group operations. The company's superior operating performance is further supported by strong earnings and cash flows from its communications division and solid returns from its investment portfolio, which have allowed the group to maintain its sound capital position despite the payment of regular stockholder dividends. Additionally, as a major writer of life products containing secondary guarantees, Jefferson-Pilot utilizes prudent assumptions with respect to reserve requirements Reserve Requirements Requirements regarding the amount of funds that banks must hold in reserve against deposits made by their customers. This money must be in the bank's vaults or at the closest Federal Reserve Bank. for these products. Nevertheless, regulatory authorities Noun 1. regulatory authority - a governmental agency that regulates businesses in the public interest regulatory agency administrative body, administrative unit - a unit with administrative responsibilities are considering changes to Actuarial ac·tu·ar·y n. pl. ac·tu·ar·ies A statistician who computes insurance risks and premiums. [Latin Guideline 38 (AXXX), which governs reserving for secondary guarantee products. Depending on the outcome, Jefferson-Pilot may be required to materially increase reserves beyond existing levels, which may negatively impact future pricing levels and product availability. Furthermore, Jefferson-Pilot has a somewhat limited ability to adjust credited rates on fixed annuities Fixed annuities Contracts in which an insurance company or issuing financial institution pays a fixed dollar amount of money per period. due to the low interest rate environment. The company faces the challenge of retaining policyholder funds as multi-year guarantee rates expire in the near to medium term. Nevertheless, A.M. Best believes Jefferson-Pilot will be successful in sustaining revenue and earnings growth in its core individual life and annuity businesses as well as managing operational risks inherent in its group business. A.M. Best will continue to monitor regulatory issues that may have the potential to impact the insurance industry. For a complete listing of Jefferson-Pilot Corporation's financial strength and debt ratings, please visit http://www.ambest.com/press/021001jeffersonpilot.pdf. For Best's Debt Ratings, all other Best's Ratings Best's rating A rating A.M. Best Co. assigns to insurance companies based on the company's ability to meet its obligations to its policyholders. , an overview of the rating process and rating methodologies, please visit http://www.ambest.com/ratings. A.M. Best Co., established in 1899, is the world's oldest and most authoritative insurance rating and information source. For more information, visit A.M. Best's Web site at http://www.ambest.com. |
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