AM Best Places Credit Ratings of Gulf Guaranty Life Insurance Company Under Review With Negative Implications

OLDWICK, N.J.--(BUSINESS WIRE)--AM Best has placed under review with negative implications the Financial Strength Rating of B++ (Good) and the Long-Term Issuer Credit Rating of “bbb+” (Good) of Gulf Guaranty Life Insurance Company (Gulf Guaranty Life) (Flowood, MS).

This Credit Rating (rating) action reflects a significant deterioration of Gulf Guaranty Life’s capital and surplus and risk-adjusted capitalization at year-end 2021, driven by an operating loss. The decline in the company’s financial performance resulted from higher claim expenses in the fourth quarter of 2021 and a material increase to reserves primarily for claims in Gulf Guaranty Life’s core limited benefit medical business. The ratings will remain under review pending reserve development toward mid-2022 and potential measures management is implementing to curb premium growth. Given the small size of the company’s absolute capital and surplus, even modest fluctuations in capital and surplus and premium may materially impact risk-adjusted capitalization.

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