2014-03-06 16:04:03 -
A.M. Best has affirmed the financial strength rating of A (Excellent) and issuer credit rating of “a” of BNZ Life Insurance Limited (BNZ Life) (New Zealand). The outlook for both ratings remains stable.
The rating affirmations reflect BNZ Life’s strong affiliation with the Bank of New Zealand Limited (BNZ), consistently superior operating results relative to its peers and strong risk-adjusted capital position.
Partially offsetting these positive rating factors are the company's concentrated distribution source and recent volatility in persistency experience. BNZ Life’s competitive position is highly dependent on BNZ to continue offering lower commissions than the independent financial advisors channel and its strong brand recognition. In addition, recent persistency experience has been below the long-term average level.
Potential deterioration in persistency experience
could have an adverse impact on the company’s longer-term profitability.
BNZ Life is well positioned at its current rating level. The ratings could be downgraded if risk-adjusted capitalization falls below the company's forecast provided to A.M. Best due to higher than expected dividend payouts, or a material decline in operating performance due to deterioration in the persistency of its in-force business.
The methodology used in determining these interactive ratings is Best's Credit Rating Methodology, which provides a comprehensive explanation of A.M. Best's rating process and contains the different rating criteria employed in the rating process. Best's Credit Rating Methodology can be found at www.ambest.com/ratings/methodology : cts.businesswire.com/ct/CT?id=smartlink&url=http%3A%2F%2Fwww ..
Ratings are communicated to rated entities prior to publication, and unless stated otherwise, the ratings were not amended subsequent to that communication.
This rating announcement has been issued by A.M. Best Asia-Pacific Limited, which is a subsidiary of A.M. Best Company. A.M. Best Company is the world's oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com : cts.businesswire.com/ct/CT?id=smartlink&url=http%3A%2F%2Fwww ..
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