Standard & Poor’s Ratings Services has increased the counterparty credit rating on AmerUs Group Company to A, from BBB plus.
Aviva P.L.C., London, announced today that it has completed a previously announced $3.1 billion acquisition of AmerUs, Des Moines, Iowa, and immediately will begin integrating the AmerUs business into its own U.S. operations.
Aviva is the fifth largest insurance group in the world in terms of premium revenue.
Thomas Godlasky now will be president of Aviva’s combined U.S. operations, which will be called Aviva, and Philip East, finance director of Aviva’s U.K. general insurance operations, will be chief financial officer, Aviva says.
S&P, New York, says it is affirming the A plus counterparty and financial strength ratings on AmerUs units such as AmerUs Life Insurance Company, Bankers Life Insurance Company of New York and Indianapolis Life Insurance Company.
S&P has based the rating actions partly on the completion of the Aviva deal, according to Robert Bowen, an S&P credit analyst.
“We consider AmerUs Group to be strategically important to the Aviva group, one of the largest insurance groups in the world,” Bowen says in a statement.
Bowen says S&P analysts also considered AmerUs’s strong competitive position in the equity-indexed annuity and equity-indexed life insurance markets.
Although AmerUs’s success in the equity-indexed markets has helped it report strong profits and maintain capital at strong levels, concentration of earnings in the equity-indexed product lines somewhat offsets the positive factors, S&P says.
AmerUs’s reliance on mortality reinsurance in the life insurance business is another factor that offsets the positive factors, S&P says.
In 2005, equity-indexed life sales accounted for about 80% of the company’s life sales, and equity-indexed annuities accounted for more than annuity division’s annuity deposits, S&P says.