A.M. Best Affirms Ratings of CIGNA Life Insurance Company of Europe SA-N.V.

A.M. Best Co. has affirmed the financial strength rating of B++ (Good) and issuer credit rating of "bbb+" of CIGNA Life Insurance Company of Europe SA-N.V. (CLICE) (Belgium). The outlook for both ratings remains stable.

The ratings reflect the company's strong level of risk-adjusted capitalisation. Offsetting factors include a potential exposure to foreign exchange movements and a likely deterioration in underwriting performance.

In A.M. Best's opinion, CLICE's level of risk-adjusted capitalisation is likely to remain strong in 2009 and 2010. A high level of intra-group reinsurance protection, a conservative investment portfolio and a sound capital base are expected to be supportive of future increases in premium income of around 15% in 2009 and 11% in 2010.

A.M. Best anticipates that the good underwriting performance achieved in 2008 is unlikely to be repeated in 2009 due to increasing loss ratios across all core line of business, driven by difficult economic conditions.

A.M. Best considers that CLICE's overall earnings remain exposed to movements in foreign exchange rates as the company does not have an active hedging programme in place. The company reports in Euros, despite a large proportion of business being undertaken within the United Kingdom and worldwide.

Although controlling a relatively small competitive market position, A.M. Best considers that CLICE has good brand recognition within its core group healthcare markets and a modest level of diversification. Diversification is achieved through the division of earnings between core UK, Spanish and expatriate group healthcare businesses, as well as European life health and accident products. It is the expatriate healthcare business that A.M. Best expects will drive future premium growth, despite difficult market conditions.

For Best's Credit Ratings, an overview of the rating process and rating methodologies, please visit www.ambest.com/ratings.

The principal methodologies used in determining these ratings, including any additional methodologies and factors that may have been considered, can be found at www.ambest.com/ratings/methodology. Founded in 1899, A.M. Best Company is a global full-service credit rating organization dedicated to serving the financial and health care service industries, including insurance companies, banks, hospitals and health care system providers. For more information, visit www.ambest.com.