OLDWICK, N.J.--(BUSINESS WIRE)-- A.M. Best has affirmed the Financial Strength Rating of A+ (Superior) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of “aa-” of Primerica Life Insurance Company (Boston, MA), and its affiliates, National Benefit Life Insurance Company (Long Island City, NY) and Primerica Life Insurance Company of Canada (Mississauga, Ontario), collectively referred to as Primerica Life. Additionally, A.M. Best also has affirmed the Long-Term ICR of “a-” of Primerica, Inc. (Primerica) (headquartered in Duluth, GA) [NYSE:PRI], which is the holding company for the group’s insurance and non-insurance operating companies. A.M. Best also has affirmed the Long-Term Issue Credit Rating of “a-” on $375 million 4.75% senior unsecured notes due 2022 of Primerica. The outlook of these Credit Ratings (ratings) is stable.

Primerica Life’s ratings recognize its status as one of the largest writers of term life insurance in the United States, with its continued strong market position attributable to its dedicated distribution affiliate, Primerica Financial Services, Inc. This integrated distribution and operating platform included approximately 117,000 life agents at the end of 2016. Primerica Life’s business profile in the United States and Canada is further reinforced by its experienced management team, which successfully built and supports its sizable sales force.

Primerica Life’s earnings have been consistent with A.M. Best’s expectations, as the group has generated solid levels of GAAP and statutory net income as margins have benefited from favorable mortality experience relative to historical pricing expectations. Statutory net income also has benefited from the inclusion of ongoing income related to the reinsurance transactions entered into at the time of Primerica’s initial public offering in 2010, as statutory accounting rules require that the gain on the reinsured business be deferred and recognized in income as actual experience emerges. A.M. Best also notes that Primerica Life’s GAAP financial leverage and interest coverage ratios are within A.M. Best’s guidelines for its current rating level.

The level of Primerica Life’s risk-adjusted capitalization, as defined by Best’s Capital Adequacy Ratio (BCAR), is sufficient to support its current business and insurance risks. A.M. Best notes that risk-adjusted capitalization had been declining prior to 2015, driven primarily by significant dividends to the holding company. However, risk-adjusted capitalization has stabilized over the past two years. Going forward, A.M. Best expects risk-adjusted capitalization ratios to continue to remain relatively stable. A.M. Best also notes that Primerica Life has relied heavily in recent years on captive reinsurance to fund its Regulation XXX reserves associated with term life insurance, which in turn has benefited the group’s risk-adjusted capitalization.

Offsetting these positive rating factors are Primerica Life’s somewhat narrow business profile and aggressive capital management strategy. As noted above, Primerica Life has relied heavily on captive reinsurance to fund its XXX reserves. As part of its assessment of a life insurance company’s balance sheet strength, A.M. Best considers not only the capital adequacy ratios, but also the quality of capital supporting such ratios.

A.M. Best believes that the quality of capital for an insurance operating company that has ceded XXX or AXXX reserves to a domestic or offshore captive is not as strong as for an operating company with similar risk-adjusted capital ratios that self-funds these reserves. In addition, while A.M. Best expects Primerica Life to maintain an underlying trend of statutory profitability, statutory capital growth of the insurance operating companies likely will be constrained by continued aggressive dividend payments to Primerica. Additionally, within the insurance business unit there is essentially a monoline product approach with an exclusive focus on term life products.

This press release relates to Credit Ratings that have been published on A.M. Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see A.M. Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Understanding Best’s Credit Ratings. For information on the proper media use of Best’s Credit Ratings and A.M. Best press releases, please view Guide for Media - Proper Use of Best’s Credit Ratings and A.M. Best Rating Action Press Releases.

A.M. Best is the world’s oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com.

Copyright © 2017 by A.M. Best Rating Services, Inc. and/or its subsidiaries. ALL RIGHTS RESERVED.

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A.M. Best

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Thomas Rosendale, +1-908-439-2200, ext. 5201

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Christopher Sharkey, +1-908-439-2200, ext. 5159

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Jim Peavy, +1-908-439-2200, ext. 5644

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Source: A.M. Best

Sep. 9—A former Lawrence County deputy was indicted in federal court this month on felony charges stemming from an alleged life insurance fraud scheme, according to court records.

Brandon Tory Hood and his wife, Heather Lynn Hood, are accused of submitting fraudulent life insurance applications using personal information Brandon Hood allegedly accessed through law enforcement databases while working as a Lawrence County deputy.

Both were indicted on one count of conspiracy to commit wire fraud, two counts of wire fraud and one count of aggravated identity theft, court records show.

Lawrence County Chief Deputy Brian Covington said Friday that Brandon Hood had previously served as police chief in Leighton, in Colbert County, before joining the Lawrence County Sheriff's Office.

"He was a deputy with us when we were informed by (the Alabama State Bureau of Investigation) that they wanted to interview him about the alleged crimes," Covington said. "Following an interview and interrogation conducted by SBI at our office, he immediately resigned before termination. I don't know at what point the alleged criminal activity started in his law enforcement career."

According to a federal grand jury indictment filed in U.S. District Court, Brandon Hood and Heather Hood were licensed insurance agents who worked with different insurance carriers. Brandon Hood was also working as a Lawrence County sheriff's deputy during the alleged scheme.

The indictment alleges Brandon Hood obtained personal identifying information — including dates of birth and Social Security numbers — belonging to family members, friends and co-workers and used it to complete and electronically submit life insurance applications.

"Once a life insurance application was submitted to an insurer, along with the first month's premium payment, the originating insurance agent would receive a commission," the indictment said.

Commissions could amount to as much as 80% of the first nine months of premium payments for each policy, according to the indictment. The purported policy owners were unaware that life insurance applications had been submitted in their names until they received cancellation notices from insurers for nonpayment of premiums.

"Brandon Tory Hood and Heather Lynn Hood ... submitted life insurance policies having a face value exceeding $24,000,000," the indictment said.

The alleged scheme occurred from Aug. 1, 2022, through at least Sept. 30, 2023, in Lawrence County, according to the indictment.

— [email protected] or 256-340-2442.

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