April 23, 2026 Reinsurance

AM Best Revises Outlooks to Positive for Western & Southern Financial Group, Inc. and Its Subsidiaries

Business Wire

OLDWICK, N.J.--(BUSINESS WIRE)--
AM Best has revised the outlooks to positive from stable and affirmed the Financial Strength Rating (FSR) of A+ (Superior) and the Long-Term Issuer Credit Ratings (Long-Term ICRs) of “aa” (Superior) of the life insurance subsidiaries of Western & Southern Financial Group, Inc. (WSFG). The WSFG subsidiaries included in this rating unit are The Western and Southern Life Insurance Company (WSLIC), Western-Southern Life Assurance Company, Columbus Life Insurance Company, Integrity Life Insurance Company, National Integrity Life Insurance Company (White Plains, NY) and The Lafayette Life Insurance Company (collectively referred to as W&SF Group). WSFG is an intermediate stock holding company of the ultimate parent company, Western & Southern Mutual Holding Company. All companies are domiciled in Cincinnati, OH, unless otherwise specified.

Concurrently, AM Best has revised the outlooks to positive from stable and affirmed the FSR of A+ (Superior) and the Long-Term ICR of “aa” (Superior) of Gerber Life Insurance Company (Gerber Life) (White Plains, NY). In addition, AM Best has revised the outlooks to positive from stable and affirmed the Long-Term ICR of “a” (Excellent) and the Long-Term Issue Credit Ratings (Long-Term IRs) on the senior unsecured notes of WSFG, as well as the Long-Term IRs of “a+” (Excellent) of WSLIC’s unaffiliated surplus notes. (See below for a detailed list of the Long-Term IRs.)

The ratings reflect W&SF Group’s balance sheet strength, which AM Best assesses as strongest, as well as its adequate operating performance, favorable business profile and very strong enterprise risk management (ERM).

The ratings of Gerber Life reflect its balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, neutral business profile and very strong ERM. The ratings also reflect implicit support from the greater organization.

The positive outlooks are driven by a trend of improving overall operating performance metrics over the past five years for W&SF Group. In addition, the group is expected to maintain its strongest level of risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR), and very strong ERM. The BCAR has declined gradually over the past five years as the group has written substantial volumes of annuity business through select distribution channels; however, the business is anticipated to continue generating a differentiated spread that will build available capital and offset near-term acquisition cost strain. The group maintains a liquidity plan under its ERM framework that could be exercised quickly if a stress in its asset portfolio is experienced; however, the impact of lower market prices has not been tested fully for the allocation to structured securities, private credit and concentration in certain real estate investments. As a leading mutual holding company in the U.S. life insurance and annuity (L/A) market, the group exhibits financial flexibility with a track record of access to various liquidity sources, including senior notes, a bank line of credit facility, surplus notes and Federal Home Loan Bank membership. W&SF Group utilizes an internal investment management team and minimal outbound annuity coinsurance to unaffiliated or affiliated reinsurers, which enhances the group’s quality of capital, although it has some goodwill and net deferred tax assets. Overall, the experienced management team has a history of insurance industry solutions expertise, and the group’s strategy has been successful at improving the level and stability of returns on available capital on a statutory and GAAP basis. The group’s operating and financial leverage ratios and interest coverage are within AM Best’s tolerance.

Partially offsetting these positive rating factors is W&SF Group’s exposure to a decline in interest rates and potential spikes in near-term liquidity needs; however, the group has generated substantial growth from a range of new sources in recent years, including funding agreement-backed notes, and it remains disciplined about the volume and mix of business it writes. The group faces ongoing competition from mutual and stock companies in the highly competitive U.S. L/A market, although the organization has expanded its well-diversified product portfolio in support of a strong distribution network. The group has some guaranteed minimum death and withdrawal benefits that are particularly sensitive to equity and fixed income markets; however, these guarantees are mostly hedged and the company manages its economic capital ratio above a target range.

The positive outlooks for Gerber Life are attributed to its growing contribution to the group’s overall premium, reserve, and statutory and GAAP earnings levels. Gerber Life has a very strong brand name recognition among consumers and was among the first to use digital distribution through independent agents to enhance access to guaranteed issue life insurance protection for the senior and juvenile markets. Fabric by Gerber Life also continues to support the leverage of the greater organization in the direct-to-consumer space.

AM Best will continue to monitor the impacts of the macroeconomic environment on the company’s overall balance sheet metrics, including its investment performance, watch lists and asset-liability mismatch and liquidity risks should liability demands in a stressed scenario become unexpectedly due before asset proceeds; and whether overall operating performance metrics continue to trend toward and remain within the levels of the strong industry composite under W&SF Group’s current business plan.

The following Long-Term IRs have been affirmed with the outlooks revised to positive from stable:

Western & Southern Financial Group, Inc.—

-- “a” (Excellent) on $500 million 5.75% senior unsecured notes, due 2033

The Western and Southern Life Insurance Company—

-- “a+” (Excellent) on $500 million 3.75% surplus notes, due 2061

-- “a+” (Excellent) on $500 million 5.15% surplus notes, due 2049

This press release relates to Credit Ratings that have been published on AM 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 AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best's Credit Ratings. For information on the proper use of Best’s Credit Ratings, Best’s Performance Assessments, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.

AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.