A.M. Best Affirms Ratings of AmerUs Group; Revises Outlook to Stable.OLDWICK, N.J. -- A.M. Best Co. has affirmed the financial strength rating of A (Excellent) for the subsidiaries of AmerUs Group Co. (AmerUs Group) (NYSE NYSE See: New York Stock Exchange :AMH AMH Abington Memorial Hospital (Abington, PA) AMH Anti-Müllerian Hormone AMH Australian Medicines Handbook AMH Automated Material Handling AMH Aviation Structural Mechanic (Hydraulics) US Navy Rating ) (Des Moines Des Moines, city, United States Des Moines (dĭ moin`), city (1990 pop. 193,187), state capital and seat of Polk co., S central Iowa, at the junction of the Des Moines and Raccoon rivers; inc. , IA). A.M. Best has also affirmed the issuer credit rating of "bbb" of AmerUs Group. Concurrently, A.M. Best has affirmed the existing debt ratings on AmerUs Group's securities. The outlook on all ratings has been revised to stable from negative. These rating actions reflect AmerUs Group's improved capitalization--on both an absolute and risk-adjusted basis--as well as its ability to maintain its targeted 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. spreads over the last several quarters in this low interest rate, highly competitive environment. A.M. Best also recognizes AmerUs Group's solid earnings, innovative product development, expanding distribution, sophisticated 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. and established positions in its core businesses. AmerUs Group's life and annuity businesses have produced steady GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). earnings, which are more than sufficient to cover fixed charges. A significant portion of earnings is generated from its stable block of individual life insurance, which has experienced favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. mortality and persistency and is supported by above-average agent retention. Additionally, A.M. Best believes operating results from AmerUs Group's annuity businesses are sustainable due to expansion of controlled distribution, significant conservation efforts and improved operating efficiency. Offsetting factors include AmerUs Group's exposure to below-investment-grade bonds relative to its capital base as compared to similarly rated peers, its elevated level of intangibles (principally deferred acquisition costs) and moderate financial leverage at the holding company, AmerUs Group's total debt-to-capital ratio--including preferreds--as of September 30, 2004, was approximately 28%. A.M. Best expects AmerUs Group's financial leverage to remain relatively constant or slightly decline in the near to medium term. For a complete listing of the AmerUs Group Co.'s debt and financial strength ratings, please visit. http://www.ambest.com/press/111203amerus.pdf. For a list of A.M. Best's debt ratings, please visit http://www.ambest.com/debt. 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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