A.M. Best Affirms Rating of CIGNA Life Insurance Company Europe S.A.-N.V.OLDWICK, N.J. -- A.M. Best Co. has affirmed the financial strength rating of B++ (Very Good) of CIGNA CIGNA CG (Connecticut General Life Insurance Company) INA (Insurance Company of North America) Life Insurance Company Europe S.A.-N.V. (CLICE) (Belgium). The outlook remains stable. The rating reflects the company's specialised business position, stable capitalisation and return to financial profitability. Specialised business position-- A.M. Best believes that CLICE's gross written premium is likely to continue growing strongly at a combined rate of approximately 20% over the next two years. The main drivers of growth are expected to be the demand for expatriate benefits and the above market average growth for life accident and health business, where the company benefits from the impact of recent distribution agreements. Stable capitalisation-- CLICE's excellent risk-adjusted capitalisation will likely remain stable over the next two years. The pressures from the strong business growth forecasted are expected to be alleviated through 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. agreements with a non-rated affiliate. The resulting high counterparty risk Counterparty Risk The risk to each party of a contract that the counterparty will not live up to their contractual obligations. Notes: In most financial contracts, counterparty risk is known as default risk. is mitigated by CLICE's decision to operate all the treaties with its affiliate on a funds-withheld basis. The active dividend policy followed by the company is not expected to have adverse effects on the overall capitalisation. Return to profitability-- CLICE returned to profitability in 2004 when, according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. A.M. Best, profits reached EUR EUR In currencies, this is the abbreviation for the Euro. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. 2.4 million (USD USD In currencies, this is the abbreviation for the U.S. Dollar. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. 2.9 million) (compared to a loss of EUR 3.1 million (USD 3.55 million) in 2003). A.M. Best believes that the technical result is likely to improve further as combined ratio stabilises at around 98% after the restructure of the Spanish dental portfolio and the resulting reduction of its management expenses. Investment return is expected to remain stable at around 4%. For 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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