AM Best Upgrades Credit Ratings of Lewer Life Insurance Company

OLDWICK, N.J.--(BUSINESS WIRE)--AM Best has upgraded the Financial Strength Rating to B++ (Good) from B+ (Good) and the Long-Term Issuer Credit Rating to “bbb” (Good) from “bbb-” (Good) of Lewer Life Insurance Company (Lewer Life) (Kansas City, MO). The outlook of these Credit Ratings (ratings) has been revised to stable from positive.

These ratings reflect Lewer Life’s balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, very limited business profile and appropriate enterprise risk management (ERM).

The rating upgrades reflect the improvement in Lewer Life’s ERM program, which has evolved over the past two years into a more formalized process with an appropriate framework. The company has internally identified a chief risk officer and implemented numerous ERM initiatives, which have favorably impacted various aspects of its risk assessment, including documented risk appetites and tolerances.

Lewer Life’s balance sheet strength assessment of very strong is based on its strongest level of risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR), partially offset by a relatively low level of absolute capital and surplus. Adequate operating performance reflects pre-tax net operating gains reported in four of the past five years, with moderated pre-tax results reported in 2021 driven by COVID-19 vaccination and testing claims for the 2020/2021 policy year, as well as the prepayment of claims before premium collection. The company’s fluctuating net premium in recent years was driven by travel restrictions from the COVID-19 pandemic impacting the international student population studying in the U.S. during 2020 and part of 2021 and, to a much lesser extent, a continuing decrease in life insurance and annuity premium from redemptions and dental group premium. Lewer Life’s very limited business profile reflects its nominal market share and premium concentration in the highly competitive international student health insurance market, which has significant exposure to regulatory, event and market risks.

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