Fitch Assigns 'BBB+' IFS Rating to Eagle Life Insurance Company
The following is from Fitch Ratings on
Fitch Ratings has assigned an Insurer Financial Strength (IFS) of 'BBB+' to
The Rating Outlook is Stable.
KEY RATING DRIVERS
Fitch considers Eagle Life to be 'core' under the agency's group rating methodology. As such, Eagle Life has been assigned the group rating. Fitch affirmed the ratings of AEL and its insurance operating subsidiaries on
Eagle Life was formed in 2008 and supports AEL's strategy of expanding distribution of core annuity products into broker-dealers and banks. The company reinsures most of its new business to AEL's lead insurance company,
RATING SENSITIVITIES (for AEL organization)
The ability of AEL to achieve a higher IFS rating is somewhat constrained by the company's limited diversity of earnings and cash flow given its heavy focus on fixed indexed annuities. This constraint could be overcome by the following:
--Enhanced capitalization with RBC above 350 percent on a sustained basis;
--Financial leverage below 25 percent;
--Continued stable or improved operating results and investment quality.
The key rating triggers that could result in a downgrade include:
--A reduction in capitalization with RBC below 300 percent;
--Sustained deterioration in operating results such that interest coverage is below 3x;
--Significant increase in lapse/surrender rates;
--Financial leverage above 50 percent.
The key rating triggers that could result in a narrowing of notching between the IDR of AEL and the IFS of AEILIC include:
--A sustainable decline in financial leverage below 30 percent;
--Sustained GAAP EBIT-based interest coverage above 8x.
FULL LIST OF RATING ACTIONS
Fitch has assigned the following rating with a Stable Rating Outlook:
--IFS 'BBB+'.
Additional information is available on fitchratings.com
Applicable Criteria
Insurance Rating Methodology (pub.
https://fitchratings.com/creditdesk/reports/ report_frame.cfm?rpt_id=868367
Additional Disclosures
Dodd-Frank Rating Information Disclosure Form
https://fitchratings.com/creditdesk/press_releases/content/ ridf_frame.cfm?pr_id=988473
Solicitation Status
https://fitchratings.com/gws/en/disclosure/ solicitation?pr_id=988473
Endorsement Policy
https://fitchratings.com/jsp/creditdesk/ PolicyRegulation.faces?context=2&detail=31
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