MADISON, Wis. (3/25/09)--A.M. Best affirmed its “A” (Excellent) financial strength rating for CUNA Mutual Group in its annual ratings review, and adjusted its outlook for CUNA Mutual. A.M. Best revised CUNA Mutual’s outlook from stable to negative, consistent with the rating agency’s negative outlook for the entire life insurance sector. “Since late in 2007, CUNA Mutual has been taking steps to maintain its financial strength in the midst of this economic crisis,” said Jim Buchheim, CUNA Mutual vice president, corporate communications. “We’re pleased to continue to earn strong, independent financial ratings in these difficult times.” The “A” rating applies to the principal companies of CUNA Mutual Group--CUNA Mutual Insurance Society, a life and health insurer, and CUMIS Insurance Society Inc., a property and casualty subsidiary. The “A” rating is the third highest rating of 16 ratings categories A.M. Best issues. In affirming the rating, A.M. Best also acknowledges CUNA Mutual’s “long-established position as a leader in providing financial solutions through its life, health and retirement products to members and employees of credit unions. “Due to the ongoing implementation of three years of transformation initiatives, CUNA Mutual has improved its overall operating efficiency in its core target market of credit unions,” A.M. Best added. CUNA Mutual’s financial strength and capital position remain strong. The company’s revenues grew by nearly 7%, and operating gain exceeded $150 million last year. CUNA Mutual’s statutory surplus declined slightly in 2008 as a result of investment losses. A.M. Best also issued several secondary ratings to CUNA Mutual Group subsidiaries:
* The Issuer Credit Ratings on CMIS and CUMIS were adjusted from a+ to a. Because CUNA Mutual has issued no public or private debt and has limited borrowing, these ratings have little significance, CUNA Mutual said; * The financial strength rating of MEMBERS Life, a dormant, downstream life company that is not core to CUNA Mutual’s operations, was moved from A- to B++ with a stable outlook. The policies still outstanding are valid and the company’s ability to pay on their value is completely unaffected by this adjustment, CUNA Mutual said; and * A stand-alone rating on each of CUNA Mutual Group’s property/casualty entities was issued. CUMIS Insurance Society Inc., the primary property/casualty company, was affirmed at “A” with a stable outlook. CUMIS Specialty, a surplus lines company, had its rating adjusted to A- with a stable outlook. There are assets in CUMIS Specialty, but no business has been written.
A.M. Best Co. is a full-service credit rating organization of financial services industries, including the banking and insurance sectors.