A.M. Best Co. has upgraded the issuer credit rating (ICR) to
“bbb+” from “bbb” and affirmed the financial strength rating (FSR) of
B++ (Good) of Trans-Oceanic Life Insurance Company (TOLIC)
(Guaynabo, PR). The outlook for the FSR is stable. The outlook for the
ICR has been revised to stable from positive.
The upgrade to the ICR reflects TOLIC’s trend of stable and profitable
operating results, maintenance of favorable risk-adjusted capitalization
and increased profitable net premiums written. The ratings also consider
TOLIC’s favorable market position in the individual accident and health
line in Puerto Rico.
Partially offsetting these positive rating factors are the company’s
significant reliance on the individual accident and health business for
profitability, inherent risks associated with this core line of business
and the overall weak state of the Puerto Rican economy. Although the
company maintains a considerable concentration in its accident and
health segment, A.M. Best notes that TOLIC has managed this line of
business effectively and exhibited stable and profitable results.
A.M. Best believes TOLIC’s ratings are well-positioned at the current
rating level. Factors that could lead to potential negative rating
actions include a significant decrease in the company’s risk-adjusted
capitalization, operating losses or considerably weaker results in its
core health segment or further product concentration.
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. For more information, visit www.ambest.com.
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