AM Best Downgrades Issuer Credit Rating of American Life & Security Corp.; Places Ratings Under Review With Developing Implications

OLDWICK, N.J.--(BUSINESS WIRE)--AM Best has downgraded the Long-Term Issuer Credit Rating (Long-Term ICR) to “bbb” (Good) from “bbb+” (Good) and affirmed the Financial Strength Rating of B++ (Good) of American Life & Security Corp. (ALSC) (headquartered in Lincoln, NE). Concurrently, AM Best has placed these Credit Rating (ratings) under review with developing implications.

These rating actions follow a decline in risked-based capitalization from year-end 2022 to first-quarter 2023, based on increased sales of annuities with credited rates supporting current market conditions, while retaining an increased portion of the liabilities on its balance sheet. The ratings have been placed under review following the announcement that the ultimate parent of ALSC, Midwest Holding Inc. (Midwest), recently signed a definitive merger agreement with Antarctica Capital, which is expected to close in the second half of 2023 and provide Midwest and ALSC additional resources. AM Best will continue to monitor this transaction and provide updates as conditions warrant.

The ratings of ALSC reflect its balance sheet strength, which AM Best assesses as adequate, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management. AM Best notes that ALSC’s ratings could be adversely impacted should further decline in its risk-adjusted capitalization level occur, a significant decrease in its operating performance trends or the company has a significant deviation from its forecasted results.

This press release relates to Credit Ratings that have been published on AM Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best's Credit Ratings. For information on the proper use of Best’s Credit Ratings, Best’s Performance Assessments, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.

AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.

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