A.M. Best Affirms Rating of Canada Life; Assigns Initial Rating to Canada Life Insurance Company of Puerto Rico, Inc.Business Editors OLDWICK, N.J.--(BUSINESS WIRE)--June 18, 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+ (Superior) of The Canada Life Assurance Company (Canada Life), Toronto, and its subsidiaries. Additionally, A.M. Best has assigned an initial financial strength rating of A+ (Superior) to Canada Life Insurance Company of Puerto Rico Puerto Rico (pwār`tō rē`kō), island (2005 est. pop. 3,917,000), 3,508 sq mi (9,086 sq km), West Indies, c.1,000 mi (1,610 km) SE of Miami, Fla. , Inc., Guaynabo, Puerto Rico Guaynabo (pronounced as IPA: [ˌɡwaiˈnabo]; also known as Guaynabo City or GC) is a municipality in the northern part of Puerto Rico, located in the northern coast of the island, north of Aguas Buenas; south of . The rating outlooks are stable. These ratings are based upon the consolidated financial strength and operating performance of Canada Life and its subsidiaries. The ratings reflect the excellent market positions of a number of Canada Life's product segments and business units, as well as its strong capitalization and geographically diverse product lines provided by operations in Canada, the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. , the United Kingdom, the Republic of Ireland, the Caribbean, Brazil and Germany. In Germany, the company recently completed its first full year of operations. Partially offsetting these strengths are the challenges to improve profitability in the U.K. operation, to continue marketing momentum in the U.S. protection business and sustain its market positions in Canada, in light of continued industry consolidation. Canada Life and its wholly-owned subsidiaries, Canada Life Insurance Company of America, Lansing, Michigan “Lansing” redirects here. For other uses, see Lansing (disambiguation). Lansing is the capital city of the U.S. state of Michigan, and the state's sixth largest city. , Canada 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 , Ardsley, New York Ardsley is a village in Westchester County, New York, United States. The population was 4,269 at the 2000 census. The Village of Ardsley is located in the Town of Greenburgh. , Canada Life International Re Ltd., Dublin, Ireland, and Canada Life Insurance Company of Puerto Rico, Inc., maintain strong market positions in a number of business segments worldwide. In recent years, Canada Life's market positions have been further enhanced by strategic acquisitions, which have allowed it to develop an ability to integrate acquired blocks of business, expand distribution capacity and improve its economies of scale within its various insurance operations. Canada Life's risk-adjusted capitalization is favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. for its current insurance and investment risks and has been enhanced by its strong 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. . In recent years, despite the impact of the weak economy and volatile equity markets, the company's operating performance has been favorably fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. enhanced by growth in new and existing businesses and improved operating efficiencies. Canada Life's operations are well-diversified by product segment and geographic region. Lately, it has continued to build on its product and geographic diversification by establishing Canada Life Insurance Company of Puerto Rico, Inc., which further develops its existing Puerto Rico and U.S. Virgin Islands businesses that focus on group life and health products. Through this company, A.M. Best believes Canada Life will be better positioned to provide excellent local Caribbean service, which will enhance its sales opportunities while providing additional tax efficiencies. In A.M. Best's opinion, Canada Life will be challenged to improve financial performance in the United Kingdom as a result of intense competition and the stringent U.K. regulatory environment. However, its solid local U.K. management team and its growth in distribution relationships with Independent Financial Advisors somewhat mitigate these challenges. Furthermore, although Canada Life has achieved marketing momentum in the U.S. protection business in recent years--which is partially attributed to the significant expansion of its group sales Group sales Block sale (of large amounts) of securities to institutional investors. group sales The distribution of a new security issue to institutional clients. offices--A.M. Best believes this operation needs greater scale. While recent acquisitions have improved Canada Life's U.S. presence, lack of adequate size and economies of scale present obstacles in achieving critical mass in this market. A.M. Best has also affirmed the financial strength rating of A+ (Superior) for the aforementioned subsidiaries of Canada Life. 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. --30--md/ny* csm
CONTACT: A.M. Best Co.
Jim Peavy, 908/439-2200, ext. 5644
james.peavy@ambest.com
or
Rachelle Striegel, 908/439-2200, ext. 5378
rachelle.striegel@ambest.com
or
Steven Faulks, 908/439-2200, ext. 5035
steven.faulks@ambest.com
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