AMERICAN UNITED LIFE INSURANCE COMPANY CLAIMS PAYING ABILITY RATING REAFFIRMED AT 'AA+'
CHICAGO, June 2 /PRNewswire/ -- Duff & Phelps Credit Rating Co. has reaffirmed the `AA+' (Double-A-Plus) claims paying ability rating of American United Life Insurance Company (AUL). The rating reflects AUL's ability to produce good returns on adjusted surplus while maintaining operating leverage at a level appropriate for its business mix. Superior quality investments and AUL's significant market share and sales momentum in the non-GIC group annuity market provide support for the rating. Also factored into the rating are the risks associated with the company's exposure to small-case group health insurance (an operation which has been downsized) and the volatile earnings pattern of its group credit insurance operation. AUL is a mutual life/health insurer with admitted assets of $5.0 billion and adjusted surplus of $286 million at year-end 1992. AUL's business includes writing both individual and group life, accident and health and annuity products, as well as credit life and health insurance. In addition, AUL accepts a substantial volume of reinsurance business. AUL's most significant business line is group annuities (non- GIC) representing about 45 percent of 1992 premiums and deposits. Individual and group annuities combined represent approximately 79 percent of the company's adjusted liabilities. During 1992, AUL produced a return on average assets of 1.28 percent and a return on adjusted surplus of 8.4 percent. Both measures of profitability are considered good. AUL's operating leverage (adjusted liabilities to adjusted surplus) was 16.1 times at year-end 1992, which is considered appropriate given its product mix. AUL's investment portfolio is comprised of bonds (70 percent of invested assets at year- end 1992), mortgages (23 percent), real estate (1 percent), policy loans (3 percent), equities (1 percent), and cash and other assets (2 percent). Both the bond portfolio and the mortgage portfolio are of very high quality. -0- 6/2/93 /CONTACT: Kevin A. Ceurvorst, CFA of Duff & Phelps Credit Rating Co., 312-368-3144/
CO: American United Life Insurance Company ST: Indiana IN: INS SU: RTG
SH -- NY065 -- 4562 06/02/93 15:23 EDT
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|Date:||Jun 2, 1993|
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