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Insurance ratings actions: S&P upgrades Fidelity & Guaranty Life

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Insurance ratings actions: S&P upgrades Fidelity & Guaranty Life

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.

Life and health

S&P Global Ratings raised its long-term issuer credit and financial strength ratings on Fidelity & Guaranty Life Insurance Co. and Fidelity & Guaranty Life Insurance Co. of New York to BBB+ from BBB- and removed them from CreditWatch positive.

The outlook is stable, reflecting the rating agency's expectation that the companies will benefit from a period of stability under new leadership and ownership structures. In November, CF Corp. closed its acquisition of Fidelity & Guaranty Life and changed its name to FGL Holdings.

The rating agency also raised its long-term issuer credit rating on Fidelity & Guaranty Life Holdings Inc. to BB+ from BB- and removed them from CreditWatch positive. The outlook is positive.

At the same time, S&P assigned its BB+ long-term issuer credit ratings to FGL Holdings and CF Bermuda Holdings Ltd. and its BBB+ financial strength rating to F&G Re Ltd. The outlook is positive on FGL Holdings and CF Bermuda and stable on F&G Re.

The positive outlooks reflect the companies' new offshore reinsurance affiliates and structure that could allow the ultimate/intermediate holding company to benefit from dividends from Bermuda.

S&P said the ratings actions reflect its improved view of Fidelity & Guaranty's capital position and financial flexibility as a result of the common equity and hybrid equity infusions associated with CF's acquisition.

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Fitch Ratings downgraded the insurer financial strength ratings of Genworth Life Insurance Co. and Genworth Life Insurance Co. of New York to B+ (weak) from BB (moderately weak) and removed them from Rating Watch Evolving.

The outlook is negative.

Fitch maintained the BB (moderately weak) insurer financial strength rating of Genworth Life & Annuity Insurance Co. on Rating Watch Evolving.

Fitch said the ratings actions follow a second extension of the closing deadline of a proposed acquisition of Genworth Financial Inc. by China Oceanwide Holdings Group Co. Ltd. The transaction is subject to regulatory approval and was initially expected to close by mid-2017. Regulatory review continues and the close deadline has been extended a second time, to April 2018.

Fitch believes the continued delay increases the uncertainty as to whether the proposed transaction will be approved.

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A.M. Best affirmed the financial strength ratings of A+ (superior) and the long-term issuer credit ratings of "aa-" of Sun Life Assurance Co. of Canada and Sun Life & Health Insurance Co. (U.S.)

A.M. Best also affirmed the long-term issuer credit rating of "a-" and existing long-term issue credit ratings of Sun Life Financial Inc.

Additionally, A.M. Best affirmed the financial strength rating of A- (excellent) and the long-term issuer credit rating of "a-" of Independence Life & Annuity Co., as well as the long-term issuer credit rating of B++ (good) and the long-term issuer credit rating of "bbb+" of Professional Insurance Co.

The outlook is stable.

The ratings reflect Sun Life Financial's strongest balance sheet strength, strong operating performance, favorable business profile and appropriate enterprise risk management, A.M. Best said.

Property and casualty

A.M. Best upgraded the financial strength rating to A (excellent) from A- (excellent) and the long-term issuer credit rating to "a" from "a-" of Farmers Mutual Fire Insurance Co. of Marble Pennsylvania.

The outlooks were revised to stable from positive.

The ratings reflect Farmers Mutual's very strong balance sheet strength, strong operating performance, limited business profile and appropriate enterprise risk management, A.M. Best said.

The ratings actions also reflect Farmer Mutual's increased balance sheet strength, significant growth in policyholders' surplus over the past five years, stable loss reserving trends, comprehensive reinsurance program with strong partners and a high-quality investment portfolio.

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A.M. Best removed from under review with negative implications and affirmed the financial strength rating of B++ (good) and the long-term issuer credit rating of "bbb" of Conifer Insurance Co.; the financial strength rating of B+ (good) and the long-term issuer credit rating of "bbb-" of Conifer's affiliate, White Pine Insurance Co.; and the long-term issuer credit rating of "bb" of its parent holding company, Conifer Holdings Inc.

The outlooks assigned to Conifer Insurance and Conifer Holdings were negative, reflecting the recent history of unfavorable operating results due primarily to reserve strengthening and adverse reserve development.

The outlook assigned to White Pine is stable, reflecting its recent and short history of favorable operating results under current Conifer Holdings management, offset by the execution risk of rapid growth and the re-mixing of its book of business.

The ratings reflect the companies' strong balance sheet strength, the marginal operating performance of the companies, limited business profile and appropriate enterprise risk management framework.

S&P Global Ratings and S&P Global Market Intelligence are owned by S&P Global Inc.