S&P Global Market Intelligence compiles ratings actions in the insurance space daily through 5:30 p.m. ET. Actions after 5:30 p.m. ET will be included in the following day's roundup.
A.M. Best upgraded Hannover Rueck SE's and its main subsidiaries' long-term issuer credit ratings to "aa" from "aa-" and affirmed their financial strength ratings of A+.
The rating agency also removed the ratings from review with positive implications and said the outlook to the ratings is stable.
Hannover Rueck's affiliates that were also upgraded include E+S Rückversicherung AG, Hannover Life Reassurance Co. of America, Hannover Re (Ireland) DAC, International Insurance Co. of Hannover SE, Hannover Re (Bermuda) Ltd. and Hannover Life Reassurance Bermuda Ltd.
The company and its subsidiaries' capital positions are underscored by "good internal capital generation, moderate financial leverage through the hybrid debt programme and effective use of both transitional and alternative retrocession markets to reduce volatility arising from peak exposures," A.M. Best said.
The company has also seen strong performance from its life-and-health segment, other than its mortality and morbidity businesses, which A.M. Best said remain an "area of underperformance." The company was also able to record a "solid" return on equity of 8.5% despite impacts from hurricanes Harvey, Irma and Maria, which resulted in high net losses for the company.
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A.M. Best affirmed the financial strength ratings of B and long-term issuer credit ratings of "bb+" of American Health and Life Insurance Co., Triton Insurance Co., Merit Life Insurance Co. and Yosemite Insurance Co.
All entities are wholly owned by OneMain Holdings Inc.
The outlook on the ratings is stable.
The ratings of American Health and Merit Life reflect each company's "strong" balance sheet and adequate operating performance, business profile and enterprise risk management, A.M. Best said.
The ratings of Triton and Yosemite reflect the companies' "very strong" balance sheets, strong operating performances, neutral business profiles and appropriate enterprise risk management. Both companies depend on OneMain as their primary distribution source and have significant concentration in credit insurance products, according to the rating agency.
Managed care
A.M. Best placed SilverScript Insurance Co.'s A financial strength rating and "a" long-term issuer credit rating under review with negative implications.
The company could be positioned for potential adverse impacts resulting from its parent company, CVS Health Corp., recently agreeing to acquire insurer Aetna Inc., the rating agency said. CVS may require the company to issue an increased dividend, putting pressure on its capitalization, as CVS looks to increase its debt to fund the potential deal.
A.M. Best did say that it believes that SilverScript's Medicare part D business could benefit from Aetna's Medicare Advantage experience, assuming the agreed-upon deal is approved.
The ratings are expected to remain under review until the transaction is completed, and the rating agency can discuss any impacts to SilverScript with CVS management.
Multiline
A.M. Best upgraded the financial strength ratings to A- from B++ and the long-term issuer credit ratings to "a-" from "bbb+" of Argus Insurance Co. Ltd. and Bermuda Life Insurance Co. Ltd., subsidiaries of Argus Group Holdings Ltd.
A.M. Best also upgraded Argus Group's long-term issuer credit rating to "bbb-" from "bb+".
The outlook on these ratings has been revised to stable from positive.
The upgrades reflect Argus Group's improved balance sheet strength and consistently favorable operating performance, A.M. Best said, adding that the company's risk-adjusted capitalization is "very strong."
A.M. Best said Argus Insurance's employee benefits segment adds diversification, and the company has strong market share in its health and property segments. The rating agency noted, however, that the market for business in Bermuda, its primary market, is limited, and its competitors that write similar product lines all compete for the same population.
Property and casualty
A.M. Best upgraded Munich Re America Corp.'s long-term issuer credit rating to "a" from "a-", as well as Munich Reinsurance Co.'s and most of its A.M. Best-rated subsidiaries' long-term issuer credit ratings to "aa" from "aa-".
At the same time, A.M. Best also removed Munich Reinsurance and the subsidiaries' long-term issuer credit ratings from review with positive implications. The rating agency also affirmed Munich Reinsurance and the subsidiaries' A+ financial strength ratings.
The credit ratings were assigned a stable outlook.
The subsidiaries included in A.M. Best's long-term issuer credit ratings upgrade and financial strength ratings affirmation include Great Lakes Insurance SE, New Reinsurance Co Ltd., Munich Reinsurance America Inc., Princeton Excess and Surplus Lines Insurance Co., American Alternative Insurance Corp., Munich American Reassurance Co., Munich Reinsurance Co. of Canada, Temple Insurance Co., American Modern Surplus Lines Insurance Co., American Family Home Insurance Co., American Modern Home Insurance Co., American Modern Insurance Co. of Florida Inc., American Modern Lloyds Insurance Co., American Southern Home Insurance Co., American Western Home Insurance Co., American Modern Property and Casualty Insurance Co. and American Modern Select Insurance Co.
The upgrades reflect Munich Reinsurance's balance sheet strength, which it calls the strongest, as well as its operating performance, business profile and "very strong" enterprise risk management, A.M. Best said.
The rating agency expects Munich Reinsurance and its subsidiaries to report a "small profit" in 2017 as a result of natural catastrophe losses in the Americas. Still, A.M. Best said it expects them to "be broadly in line with the group's risk appetite."
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A.M. Best upgraded Swiss Reinsurance Co. Ltd.'s and its affiliates' long-term issuer credit ratings to "aa" from "aa-", while also removing the ratings from under review with positive implications.
The rating agency also affirmed the company's and its subsidiaries' financial strength ratings of A+. A.M. Best also upgraded Swiss Re America Holding Corp.'s long-term issuer credit rating to "a" from "a-".
The ratings all carry a stable outlook.
The upgrades were a result of the company's balance sheet, which is underpinned by comfortable consolidated risk-adjusted capitalization and "excellent financial flexibility," A.M. Best said. The rating agency added that the company's "well-diversified" reinsurance business and product offering aided in the ratings.
The Swiss Reinsurance affiliates that also saw their ratings upgraded were Swiss Re Life and Health America Inc., Swiss Re Corporate Solutions Ltd., Swiss Re Asia Ltd., Swiss Re Europe SA, Swiss Reinsurance America Corp., Swiss Re International SE, Westport Insurance Corp., North American Specialty Insurance Co., North American Capacity Insurance Co., North American Elite Insurance Co., Washington International Insurance Co. and First Specialty Insurance Corp.
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A.M. Best downgraded GuideOne Mutual Insurance Co.'s and its wholly owned subsidiaries' financial strength ratings from A to A- and their long-term issuer credit ratings from "a" to "a-".
The subsidiaries are GuideOne Specialty Mutual Insurance Co., GuideOne America Insurance Co., GuideOne Elite Insurance Co., GuideOne National Insurance Co. and GuideOne Property and Casualty Insurance Co.
The ratings all carry a negative outlook.
The downgrades came as an indication of the company's operating results in the first half of the year, which led to capitalization losses and adverse reserve development relative to surplus, A.M. Best said. The company's ratings still do factor in its management team's focus on stabilizing near-term capital and reducing its operating results' volatility, all while maintaining a long-term vision to facilitate growth in profits.
A.M. Best said the company could see a negative rating action if it were to see further material losses to its risk-adjusted capitalization or if there were "substantial" adverse reserve development.
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A.M. Best affirmed the A++ financial strength ratings and "aaa" long-term issuer credit ratings of National Indemnity Co. and its affiliates.
The rating agency also affirmed the A- financial strength rating and the "a-" long-term issuer credit rating of Finial Reinsurance Co., and the "bbb-" long-term issuer credit rating and the "bbb-" long-term issue credit rating of Finial Holdings Inc. Berkshire Hathaway Life Insurance Co. of Nebraska's A++ financial strength rating and "aa+" long-term issuer credit rating were also affirmed, as well as First Berkshire Hathaway Life Insurance Co.'s A+ financial strength rating and its "aa-" long-term issuer credit rating.
The companies are all Berkshire Hathaway Inc. subsidiaries. A.M. Best said the ratings' outlooks are all stable.
For National Indemnity, the ratings are a reflection of the company's balance sheet strength, strong operating performance and business profile, and appropriate enterprise risk management, A.M. Best said. The ratings also factor in the companies' additional benefits from being part of Berkshire.
For Berkshire Hathaway Life Insurance Company of America, A.M. Best said the ratings indicate the company's strong risk-adjusted capitalization, steady flow of transactions and benefits of being a part of the Berkshire organization. But the rating agency also said the company's "fluctuating statutory operating trends," as well as its heightened exposure to interest-sensitive business and its concentration on non-insurance investments, partially offset the positive factors.
National Indemnity's affiliates, which also saw their ratings affirmed, include Columbia Insurance Co., National Fire & Marine Insurance Co., National Liability and Fire Insurance Co., National Indemnity Co. of Mid-America, National Indemnity Co. of the South, Berkshire Hathaway Specialty Insurance Co. and Berkshire Hathaway Direct Insurance Co.
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Fitch Ratings affirmed all of California Earthquake Authority's ratings, including its A issuer default rating.
The rating agency said the outlook is stable on the company's ratings.
The affirmation was a result of California Earthquake Authority's performance, which was "in line with expectations and no upgrade or downgrade triggers were activated." Fitch went on to say that the company's claims-paying resources are "adequate" and that the company's financial flexibility is comparatively very strong against its similarly rated peers insuring catastrophe risk.
