A.M. Best Affirms Rating of American United Life.Business Editors OLDWICK, N.J.--(BUSINESS WIRE)--May 10, 2002 A.M. Best Co. has 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 financial strength rating of A (Excellent) for American United Life Insurance Company (AUL), Indianapolis, Indiana “Indianapolis” redirects here. For other uses, see Indianapolis (disambiguation). Indianapolis (IPA: [ˌɪndiəˈnæpəlɪs]) is the capital city of the U.S. , and removed the company from under review with developing implications. The rating of "a-" on AUL's surplus note was also affirmed, and the under review was status removed. This affirmation follows AUL's announcement that it has selected a unit of Employers 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. Corporation to reinsure re·in·sure tr.v. re·in·sured, re·in·sur·ing, re·in·sures To insure again, especially by transferring all or part of the risk in a contract to a new contract with another insurance company. a portion of its reinsurance operations, including its life, long-term care long-term care (LTC), n the provision of medical, social, and personal care services on a recurring or continuing basis to persons with chronic physical or mental disorders. and international reinsurance business, which were not integral to its core operations. A.M. Best views the reinsurance transaction favorably fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. , as it provides a significant amount of free capital and enables AUL to focus on its core direct life, annuity and retirement plan businesses. The life reinsurance business is very competitive, sensitive to scale and ratings and is capital intensive, and A.M. Best believes that AUL faced significant challenges in remaining a significant competitor in this business and in meeting its profit objectives. The under review status reflected the magnitude of AUL's gross reinsurance exposure (related to the September 11 tragedy) relative to its capital level; after extensive analysis, A.M. Best believes that AUL's net exposure will not be material. 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 www.ambest.com. |
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