AM Best Withdraws From Review With Development Implications And Confirms Independence American Insurance Company Credit Ratings

OLDWICK, NJ, December 22, 2021– (COMMERCIAL THREAD) –AM Best Withdrew from review with developing implications and confirmed the Financial Strength Rating (FSR) of A- (Excellent) and the Long-Term Issuer Credit Rating (Long-Term ICR) of “A-” (Excellent) from Independence American Insurance Company (IAIC) (Wilmington, DE). The outlook assigned to credit ratings (ratings) is stable.

The ratings reflect the strength of IAIC’s balance sheet, which AM Best considers to be very strong, as well as its adequate operational performance, limited business profile and appropriate management of corporate risks. The rating also takes into account the improved rating of its ultimate parent company, JAB Holding Company s.á.rl (JAB Holding).

IAIC, formerly part of Independence Holding Company, has reached a definitive agreement with JAB Holding, which acquired a controlling 70% stake in the pet insurance business and in the shares of Independence American Holdings Corp. , including its subsidiary IAIC, Independence Holding Company’s interest in Pet Partners, Inc. and other pet-related assets. As part of the transaction, Independence Holding Company received $ 276 million in cash and a 30% stake in Independence Pet Holdings, Inc., formerly known as Iguana Capital Inc. (the intermediary holding company), a subsidiary of JAB Holding. JAB Holding invests in premium brands and consumer sectors including the companion animal sector and owns one of the largest pet hospital operations in the United StatesNational Veterinary Associatesprovide the IAIC with synergies and growth potential. The ultimate parent company provides the implicit financial flexibility and capital support necessary for potential opportunities for inorganic expansion.

IAIC has the highest level of risk-adjusted capitalization, as measured by Best’s capital adequacy ratio (BCAR). The company also maintains favorable balance sheet indicators. The trend of absolute capital and surplus growth is supported by consistent operating profits as the pet insurance business gains additional market share. The stability of the capital is supported by favorable underwriting results and investment gains, even after dividends paid to its former parent company in recent years. IAIC has many sources of liquidity, including its highly liquid investment portfolio, as well as the financial flexibility of its current parent company, JAB Holding.

The growth in premiums over the past two years, resulting primarily from incremental changes in short-term medical and pet insurance, has reflected the company’s initiatives to move it into higher growth businesses. , while increasing revenue diversity and improving margins. The group has successfully implemented these changes over the past few years, and premiums for pet insurance are expected to be the sole source of income and profit in the future. After exiting the stop-loss medical business several years ago, the IAIC has focused on profitable premium growth as a niche market carrier in its specialty health products and d group insurance, representing about half of the total premium, which will be ceded entirely to Madison. National Life Insurance in early 2022. Going forward, IAIC will only purchase pet insurance, which the company plans to expand significantly over the next three years, with premium development supported by business. generated by its two subsidiaries, Pet Partners and Figo.

IAIC’s ERM program is appropriate. The plan, which establishes a strong risk culture and governance, as well as ongoing discipline and risk identification, has continued to evolve over the past year, adding more sophisticated risk and contingency plans around of the pet insurance business.

This press release relates to credit ratings published on the AM Best website. For all rating information relating to the release and relevant 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 more information on the use and limits of credit rating opinions, please see Best Credit Score Guide. For more information on the proper use of Best’s credit scores, Best’s preliminary credit reports, and AM Best’s press releases, please see Guide to Proper Use of Best Ratings and Reviews.

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

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

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Antonietta Iachetta
Senior Financial Analyst
+1 908 439 2200, ext. 5792
[email protected]

Christophe sharkey
Manager, Public Relations
+1 908 439 2200, ext. 5159
[email protected]

Joseph Zazzera, MBA
+1 908 439 2200, ext. 5797
[email protected]

Jim peavy
Director, Communications
+1 908 439 2200, ext. 5644
[email protected]

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