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Press release content from Business Wire. The AP news staff was not involved in its creation.
PRESS RELEASE: Paid content from Business Wire
Press release content from Business Wire. The AP news staff was not involved in its creation.

Best’s Special Report: U.S. Life/Health Ratings Activity in 2021 Mixed as Insurers Navigate Headwinds

August 29, 2022 GMT

OLDWICK, N.J.--(BUSINESS WIRE)--Aug 29, 2022--

The U.S. life/health (L/H) insurance industry saw a higher number of Credit Rating (rating) upgrades in the first half of 2022 compared with the same prior-year period, with improved capitalization levels a driving force, according to a new AM Best report.

Rating downgrades decreased in the first half of 2022, according to the Best’s Special Report, “U.S. Life/Health Ratings Activity in 2021 Mixed as Insurers Navigate Headwinds,” mainly due to the removal of ratings lift owing to a decline in the strategic importance to the parent due to mergers and acquisitions (M&A). Other main takeaways in the report include:

  • In the life/annuity (L/A) segment, 10 ratings were upgraded and three were downgraded in first-half 2022, compared with seven upgrades and seven downgrades in the first half of 2021. For the health segment, AM Best upgraded six ratings and four were downgraded. By comparison, four were upgraded and none were downgraded in the first half of 2021.
  • The percentage of L/H ratings placed under review declined in first-half 2022, to 6.7% from 9.4%. Ratings on six L/A carriers and four health carriers were placed under review during first-half 2022, due mostly to M&A.
  • AM Best assigned three ratings in the first half of 2022, similar to the first half of 2021. More than three-quarters of all L/H rating actions were affirmations.

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AM Best’s outlook for the U.S. L/A and health market segments is stable. According to the report, and given the pressures of the low interest environment over the last decade, higher interest rates will be welcomed by the L/A insurers—provided the increase is gradual. The majority of the U.S. health insurers have strong levels of risk-adjusted capitalization and good liquidity sufficient to withstand COVID-19 uncertainties ahead.

To access the full copy of this special report, please visit http://www3.ambest.com/bestweek/purchase.asp?record_code=323402.

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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Copyright © 2022 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.

View source version on businesswire.com:https://www.businesswire.com/news/home/20220829005492/en/

CONTACT: Helen Andersen

Industry Analyst

+1 908 439 2200, ext. 5722

helen.andersen@ambest.comChristopher Sharkey

Manager, Public Relations

+1 908 439 2200, ext. 5159

christopher.sharkey@ambest.comJeff Mango

Managing Director,

Strategy & Communications

+1 908 439 2200, ext. 5204

jeffrey.mango@ambest.com

KEYWORD: NEW YORK NEW JERSEY EUROPE UNITED STATES NORTH AMERICA

INDUSTRY KEYWORD: OTHER PROFESSIONAL SERVICES PROFESSIONAL SERVICES INSURANCE

SOURCE: AM Best

Copyright Business Wire 2022.

PUB: 08/29/2022 10:12 AM/DISC: 08/29/2022 10:12 AM

http://www.businesswire.com/news/home/20220829005492/en