NEW YORK--(BUSINESS WIRE)--Kroll Bond Rating Agency (KBRA) today released an update to its research report discussing the significance of fraternal benefit societies in the United States. Also known simply as fraternals, KBRA believes these policyholder-owned, non-profit organizations play a key role in the life insurance industry as providers of financial services while uniting people through a common bond such as religion, ethnicity, or occupation.
The report includes a detailed exhibit listing all active U.S. fraternals, recent financial data and approximate membership. KBRA notes that fraternal membership has declined about 0.3% year-over-year, while the sector’s admitted assets and surplus levels both have increased roughly 8% from year-end 2016 to mid-year 2018.
Fraternals have been challenged to grow members, influenced by several demographic and environmental trends. Additionally, the societies themselves have historically resisted change and were not effectively communicating the fraternal story. This was even true coming out of the financial crisis, when policyholder-owned companies were viewed much more favorably than their publicly-traded peers.
Over the last several years, KBRA believes that fraternals have taken considerable steps to address these issues, the most significant being the societies’ inability to effectively communicate their great community story. These organizations have essentially reinvented themselves, positioning fraternals as key providers of financial services products and, most importantly, demonstrating commitment to community service reinforced by a common bond.
To view the report, click here.
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KBRA is a full service credit rating agency registered with the U.S. Securities and Exchange Commission as an NRSRO. In addition, KBRA is designated as a designated rating organization by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus, is recognized by the National Association of Insurance Commissioners as a Credit Rating Provider, and is a certified Credit Rating Agency (CRA) by the European Securities and Markets Authority (ESMA). Kroll Bond Rating Agency Europe Limited is registered with ESMA as a CRA.
