A.M. Best Affirms Credit Ratings of Sun Life Financial Inc. and Its Subsidiaries
December 02 2016 - 2:27PM
Business Wire
A.M. Best has affirmed the Financial Strength Rating
(FSR) of A+ (Superior) and the Long-Term Issuer Credit Ratings
(Long-Term ICR) of “aa-” of Sun Life Assurance Company of
Canada (Sun Life) (Ontario, Canada) and Sun Life and Health
Insurance Company (U.S.) (SLHIC) (Windsor, CT) – the core
insurance subsidiaries of Sun Life Financial Inc. (SLF)
(Ontario, Canada) [NYSE:SLF]. Concurrently, A.M. Best has affirmed
the Long-Term ICR of “a-” and existing Long-Term Issue Credit
Ratings (Long-Term IR) of SLF.
Additionally, A.M. Best has affirmed the FSR of A- (Excellent)
and the Long-Term ICR of “a-” of Independence Life and Annuity
Company (Wilmington, DE), as well as the FSR of B++ (Good) and
the Long-Term ICR of “bbb+” of Professional Insurance
Company (Dallas, TX). The outlook of these Credit Ratings
(ratings) is stable. (See link below for a detailed listing of the
companies and ratings.)
The rating affirmations reflect SLF's strong business profile,
demonstrated by Sun Life's leading positions in its core Canadian
markets – group life and health benefits, group pension and
individual insurance – and complemented by its renewed focus on the
U.S. group insurance and voluntary benefits space, as demonstrated
by its acquisition of the employee benefits business of
Assurant, Inc. (Assurant) in March of this year. SLF's
diversified revenue stream is further enhanced by its global asset
management business, led by MFS Investment Management, and
bolstered by recent acquisitions in North America that have
increased the asset base and broadened service capabilities through
Sun Life Investment Management.
Sun Life continues to expand its footprint in Asia through local
subsidiaries and partnerships, which are a key contributor to the
organization's results. Increased joint venture ownership in key
regions of Asia has strengthened SLF’s presence in this market.
Additionally, SLF maintains sound risk-adjusted capitalization,
strong financial flexibility and a sophisticated enterprise risk
management process, which A.M. Best views positively. In recent
years, these disciplines have led to portfolio de-risking and less
exposure to equity market volatility by focusing on less
capital-intensive businesses.
SLF's sales and earnings trends are favorable and continue to
foster the group's excellent financial flexibility. With a
debt-to-capital ratio (including preferred shares) of roughly 25%
and interest coverage of nine to 10 times, SLF is within A.M.
Best's guidelines for its current ratings.
While the group has focused its U.S. operations on markets and
businesses that lack sensitivity to interest rates and equity
market fluctuations, significant competition remains from
established players in these markets. SLF is a market leader in the
employee benefits market in Canada, and its acquisition from
Assurant has significantly raised the profile of SLF in the U. S.
employee benefits market. As the organization continues grow its
core business segments in Canada, Asia and the United States, its
results will remain subject to new business strain and lower
investment returns due to the sale of the U. S. life and annuity
business in 2013. Additionally, the company retains exposure to
real estate-linked assets through its investments in commercial
mortgage loans, direct real estate and residential and commercial
mortgage-backed securities, and may be subject to significant
losses should North American real estate market fundamentals
deteriorate. Moreover, by reducing volatility and focusing on less
capital-intensive businesses has made SLF more dependent on cash
flows from its Canadian, global asset management businesses and
growing Asian business segments.
For a complete listing of FSRs, Long-Term ICRs and Long-Term IRs
for SLF and its life/health subsidiaries, please visit Sun Life
Financial Inc.
This press release relates to Credit Ratings that have been
published on A.M. Best’s website. For all rating information
relating to the release and pertinent disclosures, including
details of the office responsible for issuing each of the
individual ratings referenced in this release, please see A.M.
Best’s Recent Rating Activity web page. For
additional information regarding the use and limitations of Credit
Rating opinions, please view Understanding Best’s Credit
Ratings.
A.M. Best is the world’s oldest and most authoritative
insurance rating and information source. For more information,
visit www.ambest.com.
Copyright © 2016 by A.M. Best Rating
Services, Inc. and/or its subsidiaries. ALL RIGHTS
RESERVED.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20161202005667/en/
A.M. BestRichard McMillan, +1 908 439 2200, ext.
5615Senior Financial Analystrichard.mcmillan@ambest.comorKen
Johnson, CFA, CAIA, FRM+1 908 439 2200, ext.
5056Senior Directorken.johnson@ambest.comorChristopher
Sharkey, +1 908 439 2200, ext. 5159Manager, Public
Relationschristopher.sharkey@ambest.comorJim
Peavy, +1 908 439 2200, ext. 5644Director, Public
Relationsjames.peavy@ambest.com
Sun Life Financial (NYSE:SLF)
Historical Stock Chart
From Aug 2024 to Sep 2024
Sun Life Financial (NYSE:SLF)
Historical Stock Chart
From Sep 2023 to Sep 2024