A.M. Best Removes Rating of American Founders Life Insurance Company from Under Review; Upgrades Financial Strength Rating.

OLDWICK, N.J. -- A.M. Best Co. has removed from under review with positive implications and upgraded the financial strength rating (FSR) to B++ (Very Good) from B (Fair) of American Founders Life Insurance Company (AFL) (Dallas, TX). In addition, A.M. Best has assigned it an issuer credit rating (ICR) of "bbb+". Concurrently, A.M. Best has affirmed the FSR of A (Excellent) of Sagicor Life Inc. (Sagicor) (Barbados) and its subsidiary, Sagicor Capital Life Insurance Company Limited (Bahamas), and assigned ICRs of "a". The outlook for all ratings is stable.

These rating actions reflect the recent change in ownership of AFL and its parent, Laurel Life Insurance Company, from Vesta Insurance Group, Inc. to Sagicor USA, Inc., a member of the Sagicor Financial Corporation (SFC) group of companies. SFC is a publicly traded Barbados-based financial services holding company in the Caribbean with operations in more than 20 countries, mainly in Latin America and the Caribbean. The group's acquisition of AFL is the first step in its diversification and expansion strategy into the U.S. life insurance market.

The rating of AFL reflects its expected contribution to the SFC group's diversification and expansion strategy in the U.S. market, the financial backing of the new parent, AFL's generally profitable operations and improved risk-adjusted capitalization following capital contributions from its new parent. Partially offsetting these strengths are AFL's large exposure to interest sensitive fixed annuities, modest business profile, inconsistent statutory earnings trends impacted by reinsurance transactions and challenges to grow organically due to the intense competition in the financial services arena.

Under the new ownership of Sagicor Group, A.M. Best anticipates AFL will rejuvenate its marketing and distribution platform through the introduction of new products and distribution capabilities in the U.S. life insurance market. In addition, A.M. Best also notes that Sagicor remains fully committed to providing full financial backing to support AFL's current and potential new business growth strategies.

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