Best’s News & Research Service - October 05, 2018 04:06 PM (EDT)
A.M. Best Comments on Credit Ratings of National Western Life Insurance Company Following Acquisition Announcement
- October 05, 2018 04:06 PM (EDT)
Oldwick //BestWire// - A.M. Best has commented that the Financial Strength Rating (FSR) of A (Excellent) and the Long-Term Issuer Credit Rating (Long-Term ICR) of “a” of National Western Life Insurance Company (NWLIC) (Austin, TX) is unchanged following the Oct. 4, 2018, announcement that NWLIC has entered into a stock purchase agreement to acquire all of the outstanding stock of Ozark National Life Insurance Company (Ozark) (Kansas City, MO) and N.I.S. Financial Services, Inc. from CNS Corporation in exchange for approximately $203 million in cash, subject to certain adjustments. The transaction is expected to close during the first quarter of 2019, subject to customary closing conditions, including regulatory approval. The Long-Term ICR of “bbb” of NWLIC’s parent company, National Western Life Group, Inc., also remains unchanged following the announcement. The outlook of these Credit Ratings (ratings) is stable.
The acquisition, which is consistent with NWLIC’s strategic objective of expanding its life insurance sales, is expected to be initially dilutive to NWLIC’s risk-adjusted capitalization, although it is expected to continue to remain in a range that A.M. Best would assess to be at the strongest level.
A.M. Best anticipates that Ozark will be maintained as a direct subsidiary of NWLIC and continue to operate under its current brand over the near term, while continuing to distribute its own life insurance product through its existing career agency channel.
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