AM Best Affirms Credit Ratings of The Empire Life Insurance Company

OLDWICK, N.J.–(BUSINESS WIRE)–AM Best has affirmed the Financial Strength Rating of A
(Excellent) and the Long-Term Issuer Credit Rating of “a” of The Empire
Life Insurance Company (Empire Life) (Kingston, Ontario, Canada).
Concurrently, AM Best has affirmed the Long-Term Issue Credit Ratings
(Long-Term IR) of Empire Life. The outlook of the Credit Ratings
(ratings) is stable. (See below for details of the Long-Term IRs.)
Empire Life is a subsidiary of E-L Financial Corporation Limited (E-L
Financial), which operates as a publicly traded Canadian investment and
insurance holding company.

The ratings reflect Empire Life’s balance sheet strength, which AM Best
categorizes as very strong, as well as its strong operating performance,
neutral business profile and appropriate enterprise risk management.

Empire Life maintains a very favorable risk-adjusted capital position,
which supports its business and investment risks. Risk-adjusted
capitalization is enhanced by the high credit quality of its investment
portfolio, and continual increases in aggregate capital levels due to
favorable earnings and debt issuances. Empire Life’s capitalization has
supported growth while maintaining levels that support its stressed
capital targets. Empire Life’s operating results have been consistently
positive in the past five years, including favorable results in 2018 due
in part to its diversified revenue stream from the wealth management and
insurance segments, and continued solid results from the group benefits
segments. The company continues to monitor the product suite and pricing
to meet the current economic, regulatory and competitive landscapes.

Conversely, Empire Life retains a fair amount of segregated fund assets,
which exposes the company to equity market volatility. In addition to
having equity market risks within its product portfolio, Empire Life
maintains a higher allocation of equity investments, compared with those
of its peers, within its general account investment portfolio. Empire
Life continues to face challenges in expanding its operations in its
core business lines as a result of continued competition. This is
especially the case within the individual insurance segment, in which AM
Best believes the company could be challenged to improve earnings and
market share against competitors that have larger scale. Despite these
challenges, Empire Life’s focus on the smaller employee market niche has
been successful and helps mitigate this risk. In addition, the company
continues to improve branding and its digital experience for agents and
clients, which should assist in improving Empire Life’s visibility and
help differentiate it from its competitors.

The following Long-Term IRs of Empire Life have been affirmed with a
stable outlook.

— “bbb+” on CAD 200 million 3.664% fixed/floating rate subordinated
debentures, due March 15, 2028

— “bbb+” on CAD 200 million 3.383% fixed/floating rate subordinated
debentures, due Dec. 16, 2026

— “bbb” on CAD 149.5 million non-cumulative rate reset Series 1
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 pertinent disclosures, including details of the office responsible
for issuing each of the individual ratings referenced in this release,
please see AM Best’s
Rating Activity
web page. For additional information
regarding the use and limitations of Credit Rating opinions, please view
Best’s Credit Ratings
. For information on the proper media
use of Best’s Credit Ratings and AM Best press releases, please view
for Media – Proper Use of Best’s Credit Ratings and AM Best Rating
Action Press Releases

AM Best is a global rating agency and information provider with a
unique focus on the insurance industry. Visit
for more information

Copyright © 2019 by A.M. Best Rating Services, Inc. and/or its


David Marek
Financial Analyst
+1 908 439
2200, ext. 5340

Edward Kohlberg
+1 908 439 2200,
ext. 5664

Christopher Sharkey
Manager, Public Relations
908 439 2200, ext. 5159

Jim Peavy
Director, Public Relations
+1 908
439 2200, ext. 5644

Author: dmnnewswire