A.M. Best reaffirms A- (Excellent) financial strength rating

[ Monday, 24 January 2011 ]

Fidelity Life has A- (Excellent) financial strength rating for 14th consecutive year
A.M. Best rating A-



A.M. Best affirms stable financial strength rating of A- (Excellent)

A.M. Best Co. has affirmed the financial strength rating of A- (Excellent) and issuer credit rating of "a-" of Fidelity Life Assurance Company Limited (Fidelity Life) (New Zealand). The outlook for both ratings is stable.

The ratings reflect Fidelity Life's consistent operating profitability and corresponding surplus accumulation and continued new business growth.

“We have maintained our A- rating, for the 14th consecutive year, and we are continuing our cautious use of corporate resources to help stabilise experience strain this year”, says Fidelity Life Chief Executive, Milton Jennings.

A.M Best says Fidelity Life has been profitable over the past five years despite showing experience losses over the same period. In 2010, the company's experience losses were mainly because of higher than planned acquisition and renewal costs, lapses and claims.

However, profits have continued to exceed experience strains, and the company's capital and surplus increased by 16.3% in fiscal year 2010 (average five-year growth rate: 20.8%). Fidelity Life's initiatives on reducing systemic strain through rate increases and cautious use of corporate resources are expected to gradually stabilise experience strain.

New business accumulation has remained strong for Fidelity Life for the 12 months to year-end June 2010. The company's pre-tax net income to net premiums written ratio in 2010 increased to 39.2% from 13.8% the previous year, primarily due to strong investment income.

The principal methodology used in determining these ratings is Best's Credit Rating Methodology -- Global Life and Non-Life Insurance Edition, which provides a comprehensive explanation of A.M. Best's rating process and highlights the different rating criteria employed. Additional key criteria utilized include: "Risk Management and the Rating Process for Insurance Companies"; "Understanding BCAR for Life and Health Insurers"; and "Rating Members of Insurance Groups." Methodologies can be found at www.ambest.com/ratings/methodology.

Founded in 1899, A.M. Best Company is the world's oldest and most authoritative insurance rating and information source. 

Milton Jennings
Chief Executive Officer






24 January 2011

This email was sent by Fidelity Life Assurance Company Limited, 81 Carlton Gore Road, Newmarket, Auckland 1023.
While Fidelity Life Assurance Company Limited (Fidelity Life) has made its best endeavours to ensure the information in this Marketing Flash is accurate, neither Fidelity Life nor any company or person associated with the document takes any responsibility for any incorrect or outdated information contained herein or for actions taken as a result.  In preparing the email, the author has not taken any individual investor's personal circumstances into account and this email should not be relied upon as the basis for an investment decision.  This email is intended for Fidelity Life advisers only and is not to be distributed to members of the public.  This email is not a recommendation or an offer of securities under the Securities Act 1978.  Investments will be accepted only on the application form in the investment statement, a copy of which can be obtained free of charge from Fidelity Life. No part of this email can be copied or reproduced without the prior permission of Fidelity Life.
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