A.M. Best Affirms Credit Ratings of Securian Financial Group, Inc. and Its Subsidiaries
November 19, 2016 by Best's News Service
Oldwick – 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 Minnesota Life Insurance Company (Minnesota Life) and its key subsidiary, Securian Life Insurance Company (Securian Life). A.M. Best also has affirmed the FSR of A- (Excellent) and the Long-Term ICRs of “a-” of American Modern Life Insurance Company (American Modern Life), a subsidiary of Minnesota Life, and its subsidiary, Southern Pioneer Life Insurance Company (Southern Pioneer Life). Concurrently, A.M. Best has affirmed the FSR of A (Excellent) and the Long-Term ICR of “ a” of Securian Casualty Company (Securian Casualty). These subsidiaries are the life/health and property/casualty subsidiaries of Securian Financial Group, Inc. (SFG) (Delaware) and collectively operate under the name Securian Financial Group (Securian).
A.M. Best also has affirmed the Long-Term ICR of “a-” of SFG, an intermediate holding company under the ultimate parent, Minnesota Mutual Companies, Inc., and affirmed the Long-Term Issue Credit Rating of “a” on $125 million 8.25% surplus notes due 2025, issued by Minnesota Life. The outlook of these Credit Ratings (ratings) is stable. All companies named above are headquartered in St. Paul, MN, except where specified.
The ratings reflect Securian’s diversified business profile and leading market position in its core operating segments. The group has reported consistently strong operating results, benefiting from diversified sources of earnings with a good balance between mortality, morbidity, spread margins and fee revenue. Securian’s risk-adjusted capitalization is considered strong relative to its insurance, investment and business risks and is qualitatively enhanced by utilization of economic capital modeling and comprehensive capital stress-testing embedded in its enterprise risk management framework. Partially offsetting rating factors are the high level of competition in Securian’s core markets that may challenge its ability to sustain long-term organic growth and variability in its by-line performance in recent periods.
The ratings of Securian Casualty reflect its strong growth in the collateral protection and guaranteed asset protection market, as well as its favorable underwriting performance and risk-adjusted capitalization. In addition, Securian Casualty provides financial support and added diversification to Securian’s Financial Institution Group segment.
The ratings of American Modern Life and Southern Pioneer Life reflect their ownership by Minnesota Life and strong risk-adjusted capitalization supported by a high credit quality investment portfolio. However, these entities have a limited business profile as most new business is being written by the parent company.
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.
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