A.M. Best Affirms Ratings of F&G Life and Affiliates; Assigns Issuer Credit Ratings.

OLDWICK, N.J. -- A.M. Best Co. has affirmed the financial strength rating of A (Excellent) of Fidelity and Guaranty Life Insurance Company (F&G Life) (Baltimore, MD) and its wholly-owned subsidiary, Fidelity and Guaranty Life Insurance Company of New York (F&G Life NY) (Purchase, NY). Concurrently, A.M. Best has assigned issuer credit ratings (ICR) of "a+" to both companies.

Additionally, A.M. Best has affirmed the financial strength rating of A- (Excellent) of Americom Life & Annuity Insurance Company (Americom Life) (Houston, TX) and has assigned an ICR of "a-". All ratings have a stable outlook. These companies are the main U.S. operating subsidiaries of Old Mutual plc (United Kingdom), an international financial services group with operations in the United Kingdom and South Africa.

The ratings of F&G Life reflect this organization's niche in the individual annuity market where it is a fixed and equity-indexed annuity market leader. The company has generated strong annuity sales reflecting its favorable position in the managing general agents distribution channel. The ratings also reflect Old Mutual plc's commitment to this market through its financial and reinsurance support of F&G Life, which allows it to sustain strong sales volumes, maintain adequate capitalization, further diversify distribution sources and continue to grow its term life segment.

F&G Life has posted significant statutory losses over recent years due to strong new business growth. Although Old Mutual plc has consistently injected capital into F&G Life, capitalization remains only adequate. However, A.M. Best believes that F&G Life will have access to future capital injections from Old Mutual plc as necessary to support its strategic initiatives.

In noting F&G Life's significant growth in equity-indexed annuities, A.M. Best acknowledges the company's prudent product design and customer profiles, effective hedging programs and active market conduct and compliance programs. However, A.M. Best remains wary over the potential declines in the industry's equity-indexed annuity sales given the increasing due diligence demanded to comply with the prevailing heightened regulatory environment.

For Best's Ratings, an overview of the rating process and rating methodologies, please visit http://www.ambest.com/ratings.

For current Best's Ratings, independent data and analysis on more than 1,100 individual life/health companies and A.M. Best groups, please visit http://www.ambest.com/lh.

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.