A.M. Best has removed from under review with developing implications, upgraded the Long-Term Issuer Credit Rating (Long-Term ICR) to "a+" from "a", and affirmed the Financial Strength Rating of A (Excellent) of Liberty Life Assurance Co. of Boston (LLAC) (Dover, NH). The outlook assigned to these Credit Ratings (ratings) is stable.
The upgrade of the Long-Term ICR follows the completion of LLAC's acquisition by Lincoln National Life Insurance Co., the lead insurance company of Lincoln National Corp. (Lincoln) [NYSE:LNC], effective May 1, 2018. LLAC will serve as Lincoln's primary marketing arm for its large case group life and accident and health business, expanding Lincoln's market position and capabilities within this segment. The ratings also reflect LLAC's balance sheet strength, which A.M. Best categorizes as adequate, as well as its adequate operating performance, limited business profile and appropriate risk management. A.M. Best expects risk-adjusted capitalization will remain adequate and be supported by Lincoln going forward. However, due to reinsurance transactions initiated in conjunction with the acquisition, LLAC's business profile is materially diminished as almost all in-force and new business is being ceded to affiliated and non-affiliated reinsurers.
A.M. Best notes that the ratings of Lincoln and its insurance subsidiaries, as well as the Long-Term Issue Credit Ratings on all outstanding notes remain unchanged.