Correction: Fitch Affirms Primerica Life Insurance Company's IFS at 'A+'; Outlook Evolving
Tuesday, Sep 01,2009, 5:20:14 PM Click:
CHICAGO--(BUSINESS WIRE)-- (This amends a press release originally published on Aug. 20 and corrects information on Citigroup's preferred stock holdings in the third paragraph.)
Fitch Ratings has affirmed the Insurer Financial Strength (IFS) rating of Primerica Life Insurance Company (Primerica Life) at 'A+'. The Rating Outlook is Evolving.
Primerica Life's rating is linked to the ratings of Citigroup in accordance with Fitch's group rating methodology. However, the Evolving Outlook associated with Primerica Life's IFS rating reflects Fitch's view that the company is no longer core to the operations of Citigroup Inc., and its rating could be raised or lowered in the event of divestiture. Today's rating action assumes that capitalization will remain strong at Primerica Life and any material dividend or other capital transfer out of the operating company could result in a downgrade of the rating.
The rating affirmation follows Fitch's review of Primerica Life's near-term operating performance, investment exposure and capitalization in the context of recent economic weakness and capital market turmoil. Despite very weak economic conditions, the company's operating performance has remained relatively stable, reflecting a conservative product profile, strong franchise and solid distribution. Also, with the exception of a material unrealized loss in the first quarter of 2009 on $391 million in Citigroup preferred stock holdings that were exchanged on July 1, 2009, for a Junior Subordinated Deferrable Interest Security, the company's conservative investment profile has helped to dampen the effects of recent capital market turmoil, and has supported the company's statutory capitalization.
In terms of premiums, Primerica Life is one of the nation's largest term life insurance writers, with over $1.1 billion in statutory premiums written in 2008. At March 31, 2009, the company reported total statutory assets of $5.8 billion and capital and surplus of $1.2 billion.
Fitch affirms the following rating with an Evolving Outlook:
Primerica Life Insurance Company
--IFS at 'A+'.
Fitch Ratings, Chicago
Bradley S. Ellis, CFA, 312-368-2089
Douglas L. Meyer, CFA, 312-368-2061
Brian Bertsch, 212-908-0549, New York
Source: Fitch Ratings
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