AM Best Affirms Credit Ratings of Aegon N.V.’s U.S. Subsidiaries
03 Novembre 2022 - 9:19PM
Business Wire
AM Best has affirmed the Financial Strength Rating of A
(Excellent) and the Long-Term Issuer Credit Ratings of “a+”
(Excellent) of the U.S. life/health (L/H) subsidiaries of Aegon
N.V. (Netherlands) [NYSE: AEG]. Aegon’s U.S. L/H companies are
Transamerica Life Insurance Company and Transamerica Financial Life
Insurance Company and referred to collectively as Aegon USA Group
(Aegon USA). The outlook of these Credit Ratings (ratings) is
stable.
The ratings reflect Aegon USA’s balance sheet strength, which AM
Best assesses as very strong, as well as its adequate operating
performance, favorable business profile and appropriate enterprise
risk management.
Aegon N.V., Aegon USA’s ultimate parent, announced on Oct. 27,
2022, that it has reached an agreement to sell its Dutch pension,
life and non-life insurance, banking, and mortgage origination
operations to ASR Nederland N.V. At present time, AM Best expects
this transaction to have a minimal impact to the group’s overall
U.S. operations and will continue to monitor the developing
transaction closely for any significant changes to the overall
strategic focus of Aegon USA.
AM Best expects Aegon USA to maintain its very strong balance
sheet strength assessment in the near term, with the strongest
level of risk-adjusted capitalization, as measured by Best’s
Capital Adequacy Ratio (BCAR). The recent equity market volatility
and realized losses in the fixed income portfolio were related to
divestments made to protect the liquidity position, which pressured
operating performance and drove down the group’s risk-adjusted
capitalization. Additionally, the group reported lower fee income
as a result of declining
account value balances, which was offset by expense savings and
normalization of claims through the most current reporting quarter.
Moreover, the mortality experienced as of June 30, 2022, attributed
to COVID-19, was less impactful than expected. Earnings volatility
continues despite divestment of certain run-off blocks of business,
and AM Best notes that Aegon USA’s overall top-line growth has been
inconsistent, where direct premium declined in 2021; however,
premium has shown signs of a rebound through mid-year 2022.
Aegon USA’s overall business profile remains favorable with a
longer-term strategic focus of building a less capital-intensive
book of business, driven by targeted growth and strategic exits in
certain lines. The group’s diverse product range contributes to
operating earnings, which include traditional life, variable life,
variable annuities, mutual funds, pensions, and accident and health
insurance. The company benefits from good diversification
geographically and by product type. Additionally, AM Best views
variable annuities with living benefit riders as displaying some of
the highest risk characteristics, as well as being vulnerable to
tail risks.
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.
Copyright © 2022 by A.M. Best Rating
Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.
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Igor Bass Senior Financial Analyst +1 908 439
2200, ext. 5109 igor.bass@ambest.com
Christopher Sharkey Manager, Public Relations
+1 908 439 2200, ext. 5159
christopher.sharkey@ambest.com
Wayne Kaminski Senior Financial Analyst +1 908
439 2200, ext. 5061 wayne.kaminski@ambest.com
Al Slavin Communications Specialist +1 908 439
2200, ext. 5098 al.slavin@ambest.com
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