Senior Financial Analyst
+1 908 439 2200, ext. 5715
Assistant Vice President
+1 908 439 2200, ext. 5359
Manager, Public Relations
+1 908 439 2200, ext. 5159
Assistant Vice President, Public Relations
+1 908 439 2200, ext. 5644
FOR IMMEDIATE RELEASE
OLDWICK – JULY 14, 2016
A.M. Best has affirmed the financial strength rating of A+ (Superior) and the issuer credit ratings (ICR) of “aa-” ofMidland National Life Insurance Company (Midland National) and North American Company for Life and Health Insurance (North American) (both domiciled in Des Moines, IA). In addition, A.M. Best has affirmed the ICR of “a-” and issue rating of “a-” for Sammons Financial Group, Inc. (SFG, Inc.) (Delaware), and its $200 million 7.0% senior unsecured notes due 2043. SFG, Inc. is an intermediate holding company for Midland National and North American, and is indirectly owned by Sammons Enterprises, Inc. (SEI). Midland National and North American (the group’s key life/health insurance subsidiaries) are jointly referred to as the Sammons Financial Group (SFG). The outlook for each rating is stable.
The affirmation of the ratings reflects SFG’s sufficient risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio, to support its insurance and business risks. One source of capital growth is through earnings, which have been positive but fluctuating over the past five years. SFG’s investment portfolio is considered well-managed and of good credit quality, and it benefits from the resources and expertise of its investment manager, Guggenheim Partners Investment Management.
SFG holds prominent market positions in the individual life and fixed indexed annuity marketplaces, with plans to grow its business in Sammons Retirement Solutions, marketing products such as mutual fund IRAs and variable annuities through wholesale distribution through independent broker/dealers. In addition, SFG’s enterprise risk management program is highly developed with well-defined monitoring processes. Lastly, the group has good financial flexibility and financial leverage and interest coverage ratios are well within A.M. Best tolerances for the ratings.
Partially offsetting rating factors include the group’s high exposure to interest-sensitive liabilities and structured securities, but these securities have generally performed historically well. In addition, risk-adjusted capital is enhanced through use of reinsurance, financial leverage and captive reinsurers. Lastly, while SFG is a strong competitor in its core markets, competition in these markets is considered high.
This press release relates to rating(s) that have been published on A.M. 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 A.M. Best’s Recent Rating Activityweb page.
A.M. Best is the world’s oldest and most authoritative insurance rating and information source.
European Union Disclosures
A.M. Best – Europe Rating Services Limited (AMBERS), a subsidiary of A.M. Best Rating Services, Inc., is an External Credit Assessment Institution (ECAI) in the European Union (EU). Therefore, credit ratings issued and endorsed by AMBERS may be used for regulatory purposes in the EU as per Directive 2006/48/EC.
A.M. Best Asia-Pacific Limited (AMBAP), Australian Registered Body Number (ARBN No.150375287), is a limited liability company incorporated and domiciled in Hong Kong. AMBAP is a wholesale Australian Financial Services (AFS) Licence holder (AFS No. 411055) under the Corporations Act 2001. Credit ratings emanating from AMBAP are not intended for and must not be distributed to any person in Australia other than a wholesale client as defined in Chapter 7 of the Corporations Act. AMBAP does not authorize its Credit Ratings to be disseminated by a third-party in a manner that could reasonably be regarded as being intended to influence a retail client in making a decision in relation to a particular product or class of financial product. AMBAP Credit Ratings are intended for wholesale clients only, as defined.
Credit Ratings determined and disseminated by AMBAP are the opinion of AMBAP only and not any specific credit analyst. AMBAP Credit Ratings are statements of opinion and not statements of fact. They are not recommendations to buy, hold or sell any securities or any other form of financial product, including insurance policies and are not a recommendation to be used to make investment /purchasing decisions.
Important Notice: A.M. Best’s Credit Ratings are independent and objective opinions, not statements of fact. A.M. Best is not an Investment Advisor, does not offer investment advice of any kind, nor does the company or its Ratings Analysts offer any form of structuring or financial advice. A.M. Best’s credit opinions are not recommendations to buy, sell or hold securities, or to make any other investment decisions. For additional information regarding the use and limitations of credit rating opinions, as well as the rating process, information requirements and other rating related terms and definitions, please view Understanding Best’s Credit Ratings.
A.M. Best receives compensation for rating related services provided to organizations that it rates. A.M. Best does not offer consulting or advisory services.