AM Best Downgrades Credit Ratings of Universal Life Insurance Company
September 12 2024 - 11:17AM
Business Wire
AM Best has downgraded the Financial Strength Rating to B
(Fair) from B+ (Good) and the Long-Term Issuer Credit Rating to
“bb+” (Fair) from “bbb-” (Good) of Universal Life Insurance Company
(ULICO) (Guaynabo, PR). In addition, AM Best has revised the
outlooks to stable from negative.
The Credit Ratings (ratings) reflect ULICO’s balance sheet
strength, which AM Best assesses as adequate, as well as its
adequate operating performance, limited business profile and
marginal enterprise risk management.
The rating downgrades reflect the revision in the operating
performance assessment to adequate from strong. Operating
performance, while consistently profitable, has experienced a
declining trend over the past several years, partially related to
market conditions and non-recurring items. The results for Q2 2024
reflect improving conditions versus prior year. ULICO continues to
reduce the effect of the counterparty risk with Private Bankers
Life & Annuity, most recently with the Aug. 9, 2024, court
appointment of a receiver assigned to execute ULICO’s judgment but
progress has been slow. While ULICO maintains a top market position
in Puerto Rico, its business profile is limited by its concentrated
product offering and geography. AM Best will continue to monitor
the financials of ULICO.
This press release relates to Credit Ratings that have been
published on AM 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 AM Best’s Recent Rating
Activity web page. For additional information regarding the use and
limitations of Credit Rating opinions, please view Guide to Best's
Credit Ratings. For information on the proper use of Best’s Credit
Ratings, Best’s Performance Assessments, Best’s Preliminary Credit
Assessments and AM Best press releases, please view Guide to Proper
Use of Best’s Ratings & Assessments.
AM Best is a global credit rating agency, news publisher and
data analytics provider specializing in the insurance industry.
Headquartered in the United States, the company does business in
over 100 countries with regional offices in London, Amsterdam,
Dubai, Hong Kong, Singapore and Mexico City. For more information,
visit www.ambest.com.
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