A.M. Best Downgrades Ratings of Investors Insurance Corporation

OLDWICK, N.J.--(BUSINESS WIRE)--A.M. Best Co. has downgraded the financial strength rating to B++ (Good) from A (Excellent) and the issuer credit rating to “bbb+” from “a” of Investors Insurance Corporation (IIC) (Wilmington, DE). Both ratings have been removed from under review with negative implications and assigned a stable outlook.

“Understanding BCAR for Life and Health Insurers”

The rating actions follow the close of the previously announced acquisition of IIC by Athene Holding Ltd. (Athene Holding) from SCOR Global Life U.S. Re Insurance Company (SCOR U.S.). IIC’s ratings were enhanced by a financial guarantee provided by SCOR S.E. (SCOR), the ultimate parent of SCOR U.S., and the ratings reflected this guarantee along with other ongoing support provided by SCOR. The financial guarantee remained in place until the close of the transaction. In a press release dated February 23, 2011, A.M. Best communicated that upon regulatory approval and completion of the sale, the ratings would most likely be downgraded to IIC’s stand-alone credit risk profile.

As part of this transaction, a portion of IIC’s annuity reserves will be ceded to Athene Life Re, a Bermuda domiciled reinsurance subsidiary of Athene Holding. Liberty Life Insurance Company, Athene Holding’s subsidiary and its primary U.S. retail annuity sales platform will provide operational support to IIC.

Reflected in the ratings is A.M. Best’s belief that Athene Holding has access to capital from its investor base, which consists of private equity and other institutional investors to fund its business plan over the medium term. Furthermore, A.M. Best believes Athene Holding’s investment expertise and strategy will enable IIC to generate acceptable spreads on both new and in-force annuity business.

The principal methodology used in determining these ratings is Best’s Credit Rating Methodology -- Global Life and Non-Life Insurance Edition, which provides a comprehensive explanation of A.M. Best’s rating process and highlights the different rating criteria employed. Additional key criteria include: “Understanding BCAR for Life and Health Insurers”, “Assessing Country Risk”; and “Rating Members of Insurance Groups.” Methodologies can be found at www.ambest.com/ratings/methodology.

Founded in 1899, A.M. Best Company is the world's oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com.

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