A.M. Best has affirmed the Financial Strength Rating of B++(Good) and the Long-Term Issuer Credit Rating (Long-Term ICR) of"bbb" of The ChesapeakeLife Insurance Co. (Chesapeake) (Oklahoma City, OK), the core insurancesubsidiary of HealthMarkets Inc.(HealthMarkets) (headquartered in North Richland Hills, TX). Additionally, A.M.Best has affirmed the Long-Term ICR of "bb" of HealthMarkets. Theoutlook of these Credit Ratings (ratings) is stable.

The rating affirmations reflect Chesapeake's continuingtrend of premium growth, return to profitability and improved risk-adjustedcapitalization. Chesapeake is the sole writer of new insurance premium forHealthMarkets. The growth of HealthMarkets Insurance Agency, Inc., Chesapeake'saffiliated company and distribution channel, combined with the growth ofthird-party agency distribution, has resulted in Chesapeake's continued premiumgrowth in recent years.

Chesapeake has maintained solid risk-adjusted capital levelswith recent improvement primarily due to an increased level of earnings. Theratings also reflect that Chesapeake's supplemental insurance portfolio wasrebranded as SureBridge and the organization has exited products regulated bythe Patient Protection and Affordable Care Act.