OLDWICK, N.J.--(BUSINESS WIRE)--A.M. Best Co. has assigned indicative ratings of “bbb” on senior unsecured debt, “bbb-” on subordinated debt and “bb+” on preferred stock and junior subordinated debt to Cigna Corporation’s (Cigna) (Philadelphia, PA) (NYSE: CI) recently filed universal shelf registration statement. The outlook assigned to these ratings is stable. A.M. Best also has withdrawn the debt ratings on the previous shelf registration, as the shelf has expired. All existing ratings for Cigna and its subsidiaries are unchanged.
The proceeds from any potential offerings may be added to Cigna’s general funds and used for general corporate purposes, unless specified in subsequent debt issuances.
Cigna’s ratings are reflective of strong earnings in its core healthcare segment and its sufficient financial flexibility. Cigna’s broad and diversified domestic product portfolio complements international products offered through Cigna Corporation’s Asian- and European-domiciled subsidiaries. Cigna’s financial leverage (debt to capital) increased significantly following the latest debt issuance related to its acquisition of HealthSpring Inc. (Nashville, TN) in early 2012. However, A.M. Best expects Cigna’s financial leverage to gradually moderate over time. Furthermore, Cigna’s increased financial leverage as well as its earnings before interest and taxes interest coverage remain adequate for the organization’s current ratings.
The methodology used in determining these ratings is Best’s Credit Rating Methodology, which provides a comprehensive explanation of A.M. Best’s rating process and contains the different rating criteria employed in the rating process. Best’s Credit Rating Methodology can be found at www.ambest.com/ratings/methodology.
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