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/FIRST ADD -- NY057 -- A.M. BEST/

 Kemper Corporation Group, Long Grove Ill., ranks among the largest 75 property/casualty groups, with nearly $836 million in net premiums written in 1992, and is comprised of three operating groups including a professional reinsurer, Kemper Reinsurance Company, and two personal lines carriers writing predominantly in the Midwest.
 In November 1992, Kemper Corporation announced its intention to sell its two personal lines insurers is expected to take place later this year. "While the holding company has sizable exposures related to real estate and mortgage loan portfolios through its life/health affiliates, A.M. Best does not expect this exposure to adversely impact the two personal lines companies, given their strong capitalization and the parent's efforts to structure these subsidiaries for sale," according to John H. Snyder, senior vice president of Best's property/casualty division.
 Economy Fire & Casualty Company, Long Grove Ill., was assigned a 1993 Best's Rating of "A+" (Superior). The group's superior financial strength was affirmed and its rating level of "A+" was unchanged. The rating applies to the lead company, Economy Fire & Casualty Company, and two affiliates that are fully reinsured by the lead company.
 This rating assignment reflects the group's superior underwriting results with a five-year combined ratio of 102, favorable liquidity, and good capitalization. These positive rating factors are derived from the group's strong personal lines underwriting results and its Midwest orientation, where the bulk of its business is written. These positive rating factors are somewhat offset by the group's historically high investment leverage, with 45 percent of surplus invested in mortgage loans and other real estate investments, and its low investment returns. The group's net premiums of $401 million were supported by $235 million in surplus in 1992.
 In addition, Federal Kemper Insurance Company, Decatur, Ill., was assigned a 1993 Best's Rating of "A" (Excellent). The company's excellent financial strength was affirmed and its rating level of "A" was unchanged.
 This rating assignment reflects the company's continued excellent operating results in its predominant personal lines book of business with a five-year combined ratio of 103, favorable liquidity, and conservative underwriting leverage. The company's net premium writings of $125 million in 1992 were supported by $65 million in surplus.
 Life Insurance Company of Georgia, Atlanta, was assigned a 1993 Best's Rating of "A+" (Superior). The company's superior financial strength was affirmed and its rating level of "A+" was unchanged.
 This rating assignment reflects the company's profitable earnings performance, excellent balance-sheet quality and strong capitalization. This rating also acknowledges the support the company receives from its ultimate parent, Internationale-Neder-landen Group, N.V., the Netherlands. Partially offsetting these strengths are the fluctuating earnings reported in its core home service life insurance segment and the relatively thin margins achieved in its group pension business.
 "Life of Georgia has developed a strong presence in the home service life insurance market where its district operations have been successful in generating consistent growth in first-year sales," said Larry G. Mayewski, senior vice president of Best's life/health division. "A.M. Best views favorably the actions which management has implemented to focus on field force productivity and administrative and general expenses, which are expected to provide enhanced profitability in the future," he added.
 The company maintains an excellent liquidity position, especially when related to its very stable liability structure. At year-end 1992, Life of Georgia held approximately $1.3 billion of investment-grade bonds, cash and short-term investments (two-thirds of invested assets). Although 21 percent of the company's assets are invested in mortgage loans, their performance has remained favorable as compared to its peers. Total problem mortgages (including restructured loans) comprised a modest 2 percent of general account assets at year end.
 In addition, Southland Life Insurance Company, Plano, Texas, was assigned a 1993 Best's Rating of "A+" (Superior). The company's superior financial strength was affirmed and its rating level of "A+" was unchanged.
 This rating assignment reflects the company's superior earnings performance, excellent balance-sheet quality and strong capitalization. This rating also acknowledges the support that the company is provided by its ultimate parent, Internationale-Neder-landen Group, N.V., the Netherlands. Southland Life has achieved a strong niche in the upper- middle and higher-income life insurance markets where sales are conducted through managing general agents, personal producing general agents and brokers.
 During 1992, the company aggressively expanded its sales activities through new distribution relationships, enabling it to move toward critical mass and lower unit costs to allow stronger future profits to be generated. "Although A.M. Best views this strategy as favorable, the longer-term performance of this business will be influenced by the company's ability to sustain its distribution relationships," Mr. Mayewski said.
 Largely as a result of the strain associated with the company's expansion, statutory profits declined 42 percent to $23.4 million during the year from 1991's level. Southland Life maintains an excellent liquidity position which is supported by approximately $713 million in investment-grade bonds, cash and short-term investments (71 percent of invested assets). The company has experienced only modest levels of problem assets in recent years. At year-end 1992, defaulted bond issues and problem mortgage loans totaled a modest $6.1 million (well under 1 percent of total assets).
 Ohio National Life Insurance Company, Cincinnati, was assigned a 1993 Best's Rating of "A+" (Superior). The company's superior financial strength was affirmed and its rating level of "A+" was unchanged.
 This rating assignment reflects the good consolidated earnings performance of its core life and annuity lines, its adequate capitalization, its favorable overall asset quality and disciplined asset/liability management practices. Partially offsetting these strengths is the continued weak results of its disability income accident and health business and the capital constraints that it faces as a mutual company.
 "Consolidated statutory profits improved 58 percent in 1992 to $18.4 million, reflecting the company's favorable operating fundamentals in the areas of mortality and persistency, and the declining unit costs which are emerging from the steady growth in its annuity reserves and new life insurance sales," said Larry G. Mayewski, senior vice president of Best's life/health division. Prior to 1990, Ohio National had focused a considerable amount of its activities on expanding its group pension segment (particularly guaranteed investment contracts). "However, over the past three years the company has been successful in its renewed efforts to expand its individual life insurance lines. A.M. Best views this strategy favorably as it is expected to enhance future profitability," Mr. Mayewski added.
 Ohio National Life's liquidity is supported by nearly $2.0 billion in investment-grade bonds, cash and short-term obligations. Although the company maintains an exposure to commercial mortgage investments (23 percent of general account assets), total problems in this area have been manageable. At year-end 1992, impaired loans (including restructures) accounted for under 2 percent of total assets and 34 percent of surplus funds, including asset valuation reserves. Ohio National Life Insurance Company ranks among the 80 largest life/health insurers in the U.S. when measured by total assets.
 Due to its strategic role as a subsidiary of Ohio National Life Insurance Company, Ohio National Life Assurance Corporation, Cincinnati, OH, was assigned a 1993 Best's Rating of "A+" (Superior). The company's superior financial strength was affirmed and its rating level of "A+" was unchanged. This rating assignment reflects the company's strategic role as a marketing arm of Ohio National Life, and is based on the consolidated performance of the parent and this subsidiary. Ohio National Life Assurance primarily markets individual universal and variable universal life insurance products.
 Peoples Security Life Insurance Company, Durham, N.C., was assigned a 1993 Best's Rating of "A+" (Superior). The company's superior financial strength was affirmed and its rating level of "A+" was unchanged.
 This rating assignment reflects Peoples Security Life's continued strong earnings performance, its high-quality investment portfolio, good asset/liability management practices and favorable risk-adjusted capitalization. This rating also acknowledges the company's prominent position in the home service market in the mid-Atlantic region.
 Peoples Security Life continues to generate strong earnings results from its maturing home service business, and in recent years, has seen substantial improvement in the profitability of its group annuity (guaranteed investment contracts) segment. Since year-end 1987, statutory operating gains totaling $211.2 million have more than offset considerable dividend payments made to its parent concern enabling capital and surplus funds to more than double over this period of time.
 "Although Peoples Security has increased its real estate-related holdings since expanding its GIC operations, over three-fifths of mortgages represent residential loans with the remaining portion of the mortgage portfolio comprised of geographically diversified commercial investments of relatively small average loan size," said Larry G. Mayewski, senior vice president of Best's life/health division. Peoples Security Life has experienced nominal non-performance in its real estate portfolio with delinquent mortgage loans (including properties in foreclosure, foreclosed and restructured) representing less than 1 percent of total assets at year end.
 At year-end 1992, the company's liquidity was supported by its favorable annual cash flow and approximately $1.6 billion in investment-grade securities and cash balances. Peoples Security Life ranks among the 80 largest life insurers in the United States when measured by total assets.
 In addition, Commonwealth Life Insurance Company, Louisville, Ky., an affiliated company, was assigned a 1993 Best's Rating of "A+" (Superior). The company's superior financial strength was affirmed and its rating level of "A+" was unchanged. This rating assignment reflects the company's favorable earnings performance, its above-average balance sheet quality, good asset/liability management and favorable capitalization. This rating also acknowledges Commonwealth Life's prominent home service position in the Southeast.
 The company's strong market position in home service insurance is complemented by its accumulation (guaranteed investment contract) business. Stable growth in its GIC segment over the past five years has resulted in considerable increases in total assets. Consistently favorable earnings results from its primary businesses has enabled the company to nearly double its surplus base since year-end 1987, despite the payment of $78.4 million of stockholder dividends to its parent company over this period of time. Although the company maintains a considerable amount of real estate exposure, one-half of Commonwealth Life's mortgage portfolio represents residential commercial investments of relatively modest size. The company's conservative underwriting practices relating to these investments has kept delinquent mortgage loans (including properties in foreclosure, foreclosed and restructured) to a nominal 1 1/2 percent of total assets.
 At year-end 1992, the company's liquidity position was supported by its sizable annual cash flow and approximately $2.4 billion in investment-grade securities and cash balances. Commonwealth Life ranks among the 70 largest life insurers in the U.S. when measured by total assets.
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 /PRNewswire -- May 24/
 /SECOND AND FINAL ADD TO FOLLOW/


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Date:May 24, 1993
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