Ratings firm AM Best has affirmed the financial strength and long-term issuer credit ratings of Empire Life Insurance Company as A (excellent) and “a,” respectively. The rating firm also regards the outlook of these credit ratings to be stable.
AM Best attributed these ratings to Empire Life’s balance sheet strength, which it categorizes as very strong, as well as the insurer’s strong operating performance, neutral business profile, and appropriate enterprise risk management.
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The ratings firm said that Empire Life maintains a very favourable risk-adjusted capital position, which supports its business and investment risks. Additionally, Empire Life’s capitalization has supported growth while maintaining levels that support its stressed capital targets.
Conversely, the insurer retains a fair amount of segregated fund assets, which exposes the company to equity market volatility. AM Best said that Empire Life continues to face challenges in expanding its operations in its core business lines as a result of continued competition.
Despite these challenges, the ratings firm believes that Empire Life’s focus on the smaller employee market niche has been successful and helps mitigate this risk. Additionally, 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.
