AM Best affirms BMO Life Insurance Company’s credit ratings


OLDWICK, New Jersey– (BUSINESS WIRE) –
AM Best confirmed the financial strength rating of A (excellent) and the long-term issuer credit rating of “a” (excellent) of BMO Life Insurance Company (BMOLAC) (Toronto, Canada). The outlook for these credit ratings (ratings) is stable.

The ratings reflect the strength of BMOLAC’s balance sheet, which AM Best considers very strong, as well as its strong operational performance, neutral business profile and appropriate management of business risks.

BMOLAC underwrites a full range of insurance products including term life insurance, whole life insurance, universal life insurance, critical illness, structured settlements and annuities. The company distributes its products through an extensive network of sales agents across Canada, and through direct channels to consumers.

BMOLAC has maintained a favorable long-term risk-adjusted capitalization level. AM Best currently rates the company’s risk-adjusted capitalization, as measured by Best’s capital adequacy ratio (BCAR), as very strong. It should be noted that the capitalization of BMOLAC in recent years has been managed by dividend payments which have included $ 200 million in 2020. The company has performed well throughout the COVID-19 pandemic despite a slight decline in premiums and earnings in 2020, which saw a substantial positive rebound through July 2021. The company has performed well over the long term, with a five-year average return on equity of nearly 13%.

The continued competition BMOLAC faces from the largest insurance companies to gain market share in the mature and concentrated Canadian market partially offsets these positive rating factors. The asset-liability matching of BMOLAC’s long-term business portfolio in a low interest rate environment also remains a challenge. AM Best notes, however, that these challenges have been successfully managed by the company over the long term.

This press release relates to credit ratings published on the AM Best website. For all rating information relating to the publication and relevant disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this publication, please see AM Best’s Recent Rating Activity webpage. . For more information on the use and limitations of credit rating reviews, please see Best’s Guide to Credit Ratings. For more information on the proper use of Best Credit Ratings, Best Preliminary Credit Ratings, and AM Best press releases, please see the Guide to Appropriate Use of Best Ratings and Ratings.

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

Copyright © 2021 by AM Best Rating Services, Inc. and / or its affiliates. ALL RIGHTS RESERVED.

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Kevin varvaro
Financial Analyst

+1 908 439 2200, ext. 5487

[email protected]

Bruno Caron
Associate Director

+1 908 439 2200, ext. 5144

[email protected]

Christophe sharkey
Manager, Public Relations

+1 908 439 2200, ext. 5159

[email protected]

Jim peavy
Director, Communications

+1 908 439 2200, ext. 5644

[email protected]

Source: AM Best

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