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FOR IMMEDIATE RELEASE
OLDWICK - APRIL 15, 2015 04:50 PM (EDT)
A.M. Best has upgraded the issuer credit ratings to "bbb+" from "bbb" and affirmed the financial strength rating of B++ (Good) of AmFirst Insurance Company (AmFirst) (Oklahoma City, OK) and its wholly owned subsidiary, Monitor Life Insurance Company of New York (Monitor Life) (Utica, NY). The outlook for all ratings is stable.
The upgrade reflects AmFirst and Monitor Life's net premium revenue growth, consistent operating results and strong capital growth. On a consolidated basis, net premium revenue for the companies has shown material growth in the past year, driven by increased sales of its medical gap products through strategic relationships and the retention of business that had been ceded to an affiliate. Overall operating earnings reached their highest level in the past five years, driven by favorable operating trends for the group's core Premium Saver product, as well as its growing dental business. Although the organization's core medical gap products have high acquisition costs, they produce good operating margins and operating cash flows. Capital growth trends have also been strong with earnings being retained by AmFirst in support of the company's growing business. Additionally, Monitor Life's ratings reflect the strategic role the company has within the AmFirst organization, as well as favorable operating trends and a good level of risk-adjusted capital. Since being acquired by AmFirst, Monitor Life has provided the organization with both product and geographic expansion and has contributed meaningfully to overall earnings.
Positive rating movement on AmFirst's and Monitor Life's ratings could occur if the companies continue to report premium growth while maintaining a high level of risk-adjusted capital, sustained operating earnings and margin trends, as well as further earnings diversification. Conversely, negative rating movement could occur if either company experiences a material deterioration in operating performance or a significant decline in risk-adjusted capital.
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 .
Key insurance criteria reports utilized:
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 visit A.M. Best's Ratings & Criteria Center.
A.M. Best Company is the world's oldest and most authoritative insurance rating and information source.