Fitch Affirms Liberty Life Insurance Company IFS at 'A+'.NEW YORK -- Fitch Ratings has affirmed the insurer financial strength rating of Liberty Life Insurance Company (LLIC LLIC Large Low-Income Country ) at 'A+'. The Rating Outlook is Stable. Fitch's rating on LLIC, formerly known as Business Men's Assurance Company of America (BMA BMA British Medical Association. ), is supported by the company's strong risk-adjusted capital position, conservative asset profile and its position as a subsidiary of Royal Bank of Canada Bank of Canada Canada's central bank, established under the Bank of Canada Act (1934). It was founded during the Great Depression to regulate credit and currency. The Bank acts as the Canadian government's fiscal agent and has the sole right to issue paper money. (RBC RBC red blood cell. RBC or rbc abbr. red blood cell RBC, n See red blood cell count. RBC red blood cells; red blood (cell) count (see blood count). ). These positives are partially offset by the company's limited scale and its current modest competitive position in the asset accumulation arena. Fitch considers LLIC's risk-based capital position to be very strong at 461% at Sept. 30, 2006. In addition, Fitch believes LLIC's asset quality and liquidity are strong. The company's bond portfolio has an average credit quality of AA and over 97% is traded publicly. Although the company has an above industry average asset allocation in mortgage loans, the portfolio has consistently performed well with below industry average delinquencies. Although there are no explicit support agreements in place between LLIC and RBC, Fitch believes that LLIC benefits not only from its ultimate parent's capital resources but also from administrative support, risk management expertise and distribution opportunities. The benefits of this affiliation are encompassed in LLIC's current rating. Fitch's rating concerns for LLIC include the company's limited scale in the United States and its current modest competitive position in the life insurance and asset accumulation arena. During the first nine months of 2006, the company's total statutory premium income and net operating gain were modest at $368 million and $10 million, respectively. Fitch expects LLIC to maintain its NAIC NAIC See National Association of Investors Corporation (NAIC). risk-based capital ratio Risk-based capital ratio Bank requirement that there be a minimum ratio of estimated total capital to estimated risk-weighted asset. above 350% of the company action level. A strong capital position is important to the company's current rating, as is the continued financial and managerial support of its ultimate parent, RBC. Fitch also expects LLIC to maintain a very conservative investment profile. Fitch believes LLIC's statutory operating profitability will remain strained in the intermediate term, primarily due to high first-year sales expenses, which are expected to rise given that RBC's insurance operation (collectively referred to as RBC Insurance) intends to utilize LLIC's product lineup to expand its operations in the United States. LLIC is headquartered in Greenville, South Carolina
Greenville is a mid-sized city located in the upstate of South Carolina. It is the county seat of Greenville CountyGR6 . On Sept. 30, 2006, the company reported total admitted assets of $3.8 billion and total available capital of $310 million. On June 30, 2006, BMA merged with its former parent, Liberty Life Insurance Company (Old) and changed its name to Liberty Life Insurance Company (LLIC). The company operates under the RBC Insurance brand. Fitch affirms the following rating with a Stable Outlook: Liberty Life Insurance Company --Insurer financial strength at 'A+'. Fitch's rating definitions and the terms of use Terms of Use are rules set up by the owner of an intellectual property or service to govern how they may be legally used. In many cases, terms of service are used as a contractual agreement between a company and users of a service they provide. of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures Policies and Procedures are a set of documents that describe an organization's policies for operation and the procedures necessary to fulfill the policies. They are often initiated because of some external requirement, such as environmental compliance or other governmental are also available from the 'Code of Conduct' section of this site. |
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