AM Best Affirms Credit Ratings of Oxford Life Insurance Company and Its Subsidiaries
July 30 2020 - 9:24AM
Business Wire
AM Best has affirmed the Financial Strength Rating (FSR)
of A- (Excellent) and the Long-Term Issuer Credit Ratings
(Long-Term ICR) of “a-” of Oxford Life Insurance Company (Oxford
Life) (Phoenix, AZ), and its subsidiary, Christian Fidelity Life
Insurance Company (Dallas, TX), which are collectively referred to
as Oxford Group. The outlook of these Credit Ratings (ratings) is
positive. Concurrently, AM Best has affirmed the FSR of B++ (Good)
and the Long-Term ICR of “bbb” of North American Insurance Company
(Madison, WI). The outlook of these ratings is stable. These
companies are owned by the group’s ultimate parent, AMERCO [NASDAQ:
UHAL], which is also the parent of U-Haul International, Inc.,
North America’s leading “do-it-yourself” household moving and
self-storage operator.
The ratings of Oxford Group reflect its balance sheet strength,
which AM Best categorizes as very strong, as well as its adequate
operating performance, limited business profile and appropriate
enterprise risk management.
The ratings are supported by Oxford Group’s excellent risk
adjusted capitalization and overall solid operating trends. The
ratings also reflect the group’s increasingly diversified business
profile within the senior market following Oxford Group’s execution
of its business strategy in the annuity, final expense and Medicare
supplement insurance marketplace. Oxford Group has a conservative
investment portfolio that continues to produce consistent net
investment income.
Partially offsetting these positive factors are the significant
competitive challenges that Oxford Group faces from larger
insurance entities in its core lines. Moreover, the sustained low
interest environment continues to pressure performance for
interest-rate sensitive products, industry-wide. Oxford maintains a
high level of interest-sensitive reserves on its balance sheet,
although AM Best notes that the large majority of Oxford’s annuity
business was written with relatively low minimum guarantees.
Finally, the currently high degree of economic uncertainty reduces
earnings visibility for life and annuity writers and increases the
possibility of asset impairments.
Continuation of the positive outlook reflects Oxford’s
increasingly diversified business profile, stable operating results
and consistently supportive levels of risk-adjusted capitalization.
A positive rating action may occur if the group continues to
produce profitable premium growth while maintaining its relative
market positions in its key business lines.
The ratings of North American Insurance Company, which is
currently in runoff, reflect its balance sheet strength, which AM
Best categorizes as strong, as well as its adequate operating
performance, very limited business profile and appropriate
enterprise risk management.
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 media use of Best’s
Credit Ratings and AM Best press releases, please view Guide for
Media - Proper Use of Best’s Credit Ratings and AM Best Rating
Action Press Releases.
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 New York, London,
Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more
information, visit www.ambest.com.
Copyright © 2020 by A.M. Best Rating
Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.
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version on businesswire.com: https://www.businesswire.com/news/home/20200730005608/en/
Joni Cerbone Senior Financial Analyst +1 908
439 2200, ext. 5726 joni.cerbone@ambest.com
Gregory Dickerson Associate Director +1 908 439
2200, ext. 5161 gregory.dickerson@ambest.com
Christopher Sharkey Manager, Public Relations
+1 908 439 2200, ext. 5159
christopher.sharkey@ambest.com
Jim Peavy Director, Public Relations +1 908 439
2200, ext. 5644 james.peavy@ambest.com
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