AM Best confirms the credit ratings of Industrial Alliance Insurance and Financial Services Inc. and its subsidiaries


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OLDWICK, NJ–(BUSINESS WIRE)–
AM Best confirmed the financial strength rating (FSR) of A+ (Superior) and the long-term issuer credit rating (Long-term ICR) of “aa-” (Superior) of Industrial Alliance Insurance and Services financial inc. (IA) (Quebec ). At the same time, AM Best affirmed IA’s long-term issue credit ratings (long-term IR). In addition, AM Best confirmed the FSR of A (Excellent) and the long-term KPIs of “a” (Excellent) of IA’s US life insurance entities within the IA American Life group. (See below for a detailed list of companies.) AM Best has also confirmed the FSR of A (Excellent) and the long-term ICR of “a+” (Excellent) from Industrial Alliance Pacific General Insurance Corporation (IAPG ) (headquarters in Vancouver, Canada). In addition, AM Best confirmed the FSR of A (Excellent) and the long-term ICR of “a” (Excellent) from Dealers Assurance Company (DAC) (Columbus, OH). The outlook for these Credit Ratings (ratings) is stable.

IA’s ratings reflect the strength of its balance sheet, which AM Best rates as very strong, as well as its strong operational performance, favorable business profile and appropriate enterprise risk management (ERM).

AI operations in Canada continue to have a favorable capital position with fairly stable risk-adjusted capitalization, supported by retained earnings and repositioning of long-term investments to reduce risk, but partially offset by dividends . The company’s financial leverage remains within tolerance. Resilient fundamental trends support IA’s strong operating performance, which is driven by favorable profitability and premium growth in Individual Insurance, Individual Wealth Management and Group Savings Insurance. The ratings also recognize IA’s diverse business profile and its continued growth organically and through acquisitions. IA’s ERM practices reflect a developed risk framework and formalized risk appetite, as well as an emphasis on strong risk governance across the organization.

IA American Life Group’s ratings reflect the strength of its balance sheet, which AM Best rates as very strong, as well as its marginal operating performance, neutral business profile and appropriate ERM.

The ratings also acknowledge the continued support it has received from IA through capital contributions and synergies from head office management of its actuarial reserves and investment portfolio. AM Best views IA American Life Group’s focus on individual life insurance in the United States favorably, with support from its parent company which included another $40 million contribution in 2021, following a similar contribution in 2020.

DAC’s ratings reflect the strength of its balance sheet, which AM Best rates as strong, as well as its strong operational performance, neutral business profile and appropriate ERM.

IAPG’s ratings reflect the strength of its balance sheet, which AM Best rates as very strong, as well as adequate operating performance, neutral business profile and appropriate ERM. The ratings of DAC and IAPG reflect the improvement of IAF, which recognizes their contribution to the overall strategy of the group.

The FSR of A (Excellent) and the long-term KPIs of “a” (Excellent) have been confirmed with a stable outlook for the following entities of the IA American Life group:

  • IA American Life Insurance Company

  • American-Amicable Life Insurance Company of Texas

  • Pioneer Security Life Insurance Company

  • Pioneer American insurance company

  • Occidental Life Insurance Company of North Carolina

The following long-term IRs have been confirmed with a stable outlook:

Industrial Alliance Insurance and Financial Services Inc.—

— “a” (Excellent) on C$400 million 3.30% subordinated debentures due 2028

— “a-” (Excellent) on CAD 125 million 4.60% Non-Cumulative Perpetual Preferred Shares, Series B

— “a-” (Excellent) on CAD 250 million 4.30% Non-Cumulative Perpetual Preferred Shares, Series G

— “a-” (Excellent) on CAD 150 million 4.80% Non-Cumulative Preferred Shares, Series I due 2023

The following indicative long-term IRs on securities available under pre-registration have been confirmed with a stable outlook:

Industrial Alliance Insurance and Financial Services Inc.-

— “a+” (Excellent) on senior unsecured debt

— “a” (Excellent) on subordinated debt

— “a-” (Excellent) on preferred shares

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 relevant 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 more information on the use and limitations of credit rating opinions, please see Best’s Guide to Credit Ratings. For more information on the proper use of Best’s Credit Scores, Best’s Performance Ratings, Best’s Preliminary Credit Ratings, and AM Best’s press releases, please see the Guide to Proper Use of Best’s Best ratings and reviews.

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 more than 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 AM Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.

Bruno Caron

Associate Director

+1 908 439 2200 ext. 5144

[email protected]

Anthony McSwieney

Senior Financial Analyst

+1 908 439 2200 ext. 5715

[email protected]

Michael Buckley

Financial Analyst

+1 908 439 2200 ext. 5658

[email protected]

Christopher Sharkey

Manager, Public Relations

+1 908 439 2200 ext. 5159

[email protected]

Jeff Mango

General director,

Strategy & Communication

+1 908 439 2200 ext. 5204

[email protected]

Source: AM Best

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