OLDWICK, NJ–(BUSINESS WIRE)–AM Greatest has affirmed the Monetary Power Ranking (FSR) of A+ (Superior) and the Lengthy-Time period Issuer Credit score Scores (Lengthy-Time period ICRs) of “aa-” (Superior) of The Penn Mutual Life Insurance coverage Firm (Penn Mutual Life) (Horsham, PA) and its wholly owned subsidiaries, The Penn Insurance coverage and Annuity Firm (Wilmington, DE), Vantis Life Insurance coverage Firm (Windsor, CT) and The Penn Insurance coverage and Annuity Firm of New York (Brewster, NY) . These firms collectively are known as Penn Mutual Group (Penn Mutual). Concurrently, AM Greatest has affirmed the Lengthy-Time period Problem Credit score Scores (Lengthy-Time period IRs) of “a” (Glorious) on the $200 million, 6.65% surplus notes, due 2034, and the Lengthy-Time period IR of “a” ( Glorious) on the $200 million, 7.625% surplus notes, due 2040, issued by Penn Mutual Life. The outlook of those credit score scores (scores) is secure.
The scores replicate Penn Mutual’s steadiness sheet power, which AM Greatest assesses as strongest, in addition to its robust working efficiency, favorable enterprise profile and acceptable enterprise danger administration.
Penn Mutual’s risk-adjusted capitalization is taken into account to be on the strongest stage, as measured by Greatest’s Capital Adequacy Ratio (BCAR), and is supported by the corporate’s constant progress in capital over the previous few years and its effectively managed funding portfolio, which accommodates some built-in enhanced danger however continues to supply favorable internet yields relative to friends and business benchmarks. The steadiness sheet is additional supported by good liquidity metrics and total monetary flexibility of the group. The group’s leverage and protection metrics are pretty modest and thought of sufficient to assist its present operations.
Penn Mutual traditionally has reported favorable progress in its core life insurance coverage merchandise, although more-recently this has been offset with stagnant annuity gross sales as a result of pandemic. The corporate advantages from its variety in product choices, distribution capabilities and partnerships, which has resulted in elevated market share, albeit unchanged in 2020. AM Greatest notes that Penn Mutual has benefited positively from its software and underwriting device, ACE, which has allowed advisers entry to real-time information, significantly within the present difficult surroundings. General, Penn Mutual’s GAAP working efficiency considerably improved in 2021, in contrast with a decline within the prior yr, because of continued robust gross sales throughout many enterprise strains and extra funding earnings. As well as, AM Greatest notes that statutory working metrics proceed to be strained considerably, associated to gross sales of sure merchandise, unfavorable mortality and new reserve rules affecting some elevated volatility.
Penn Mutual’s give attention to danger administration displays its formalized framework, together with well-communicated danger urge for food and tolerances, multi-combined state of affairs stress testing and a danger tradition that’s strictly embedded throughout all ranges of the group.
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