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FOR IMMEDIATE RELEASE
OLDWICK - APRIL 09, 2014 12:33 PM (EDT)
A.M. Best has upgraded the financial strength rating to B++ (Good) from C++ (Marginal) and issuer credit rating to "bbb" from "b+" of Atlantic Southern Insurance Company (Atlantic Southern) (San Juan, PR). The ratings have been removed from under review with positive implications and assigned a stable outlook.
These actions reflect the completion of the acquisition of Atlantic Southern by Triple-S Vida, Inc. (San Juan, PR), a subsidiary of Triple-S Management Corporation (TSM) (San Juan, PR) [NYSE: GTS] and A.M. Best's discussions with management regarding plans for Atlantic Southern. Previously, the published ratings of Atlantic Southern reflected the weak financial position of its former parent, North America Life Insurance Company (Austin, TX).
The rating upgrades reflect the ownership by a financially stronger parent as well as the benefits from integrating Atlantic Southern's operations in the near to medium term. Furthermore, the acquisition provides the TSM organization with a gateway into the Central and South American life and health insurance market.
Atlantic Southern is adequately capitalized for its current operations. Additionally, the ultimate parent company, TSM, has a history of providing financial support to its subsidiaries when the need arises. Atlantic Southern offers a number of licenses to operate in the Caribbean region as well, making it a true international Even though Atlantic Southern has established operations in Costa Rica, the market is new to TSM and requires caution. Although Atlantic Southern is domiciled in Puerto Rico, A.M. Best views the economic, political and financial system risk for Costa Rica as being relatively high. However, A.M. Best recognizes that the Triple-S organization shares many cultural and language ties with Costa Rica. The initial operating scale is expected to be small in the first few years as the company hones its product designs to fit the new marketplace.
Key factors that could result in future positive rating actions include further integration into the TSM organization, improvement in operating results and favorable trends in capitalization.
Factors that could result in future negative rating actions include continued weak operating performance, reduction in capital or failure to execute on strategy.
The methodology used in determining these ratings is Best's Credit Rating Methodology, which provides a comprehensive explanation of A.M. Best's rating process and contains the different rating criteria employed in the rating process. Best's Credit Rating Methodology can be found at www.ambest.com/ratings/methodology.
A.M. Best Company is the world's oldest and most authoritative insurance rating and information source.