A.M. Best Affirms Ratings of MetLife, Inc. and Its Subsidiaries

  A.M. Best Affirms Ratings of MetLife, Inc. and Its Subsidiaries

Business Wire

OLDWICK, N.J. -- November 28, 2012

A.M. Best Co. has affirmed the financial strength rating (FSR) of A+
(Superior) and issuer credit ratings (ICR) of "aa-" of the primary life/health
insurance subsidiaries of MetLife, Inc. (MetLife) (New York, NY) [NYSE: MET].
Concurrently, A.M. Best has affirmed the ICR of "a-" as well as all existing
debt ratings of MetLife.

A.M. Best also has affirmed the FSR of A (Excellent) and ICRs of “a+” of the 
property/casualty companies consisting of Metropolitan Property and Casualty
Insurance Company (Warwick, RI) and its eight reinsured subsidiaries. The
outlook for all ratings is stable. (See link below for a detailed listing of
the companies and ratings.)

The rating affirmations reflect MetLife's diverse business mix, leading market
position in its core business lines, strong brand recognition, favorable
operating results and significant operating scale. These strengths are
enhanced by proactive de-risking strategies as the company looks to focus on
less capital intensive and market sensitive products. MetLife also has
benefited from significant gains on interest rate hedges, which have helped to
reduce its earnings volatility in the current low interest rate environment.

Through its broad and diversified distribution channels, MetLife has the scale
and distribution capabilities necessary to maintain its leadership positions
in a number of product lines. Moreover, A.M. Best recognizes the strong
diversity of earnings and revenue generated by its expanded international
operation. In addition, MetLife’s ratings reflect some improvement in its
financial leverage and interest coverage ratios. MetLife maintains a very
strong liquidity position at the holding company and has the resources to fund
upcoming debt maturities without accessing the capital markets. Additionally,
MetLife has recently issued debt at very favorable rates, taking full
advantage of the current historically low interest rate environment.

Partially offsetting these positive rating factors is MetLife's overall risk
appetite and risk-adjusted capital position (as measured by Best's Capital
Adequacy Ratio), which is viewed as somewhat low for its current rating level.
A.M. Best continues to have concerns regarding the company's high exposure to
real estate linked assets, primarily from its large commercial mortgage loan
portfolio and real estate holdings as well as its overall higher level of
below investment grade bonds relative to the industry. A.M. Best believes
MetLife's future earnings will be pressured as the low interest rate
environment continues to strain its interest sensitive product margins and
further spread compression. A.M. Best believes MetLife’s significant block of
variable annuity business with embedded guarantees may lead to earnings
volatility as interest rates and equity markets change. However, A.M. Best
notes that MetLife has purposely curtailed new business growth in this segment
and introduced products with protected growth strategies to mitigate this risk
on new business.

The ratings for the property/casualty unit recognize its strong
capitalization, consistent trend of favorable operating performance,
successful multiple-channel distribution network and extensive market

Additional positive rating factors include the property/casualty unit’s
geographic diversification and the marketing advantage it derives from the
established brand name recognition of MetLife. Furthermore, the ratings
acknowledge management’s focused operating strategy, extensive product
knowledge and multiple distribution channels. The companies have consistently
generated capital through disciplined underwriting, solid pre-tax operating
income and strong total investment returns. The ratings also recognize the
financial strength and support provided by MetLife.

Partially offsetting these positive rating factors are the property/casualty
unit’s moderately elevated underwriting leverage, a dividend policy that
constrains its surplus growth and exposure to severe weather-related events.

Positive rating actions could occur following a significant improvement in
operating performance or change in business profile that results in a
proportionally larger contribution by the property/casualty operation to the
overall earnings of MetLife. Negative rating actions could occur following a
sudden, unexpected and material decline in the company’s risk-adjusted
capitalization, a sustained deterioration in its operating performance or
diminished liquidity measures.

Key rating drivers that may lead to positive rating actions on the life/health
subsidiaries include a consistent ability to outperform peers, diminished risk
profile and capital improvement at the operating company. Key rating drivers
that may lead to negative rating actions include a sustained material
deterioration in operating performance, material impairments or realized
losses in the investment portfolio or diminished key capital, leverage,
coverage and liquidity ratios.

For a complete list of MetLife, Inc. and its subsidiaries' FSRs, ICRs and debt
ratings, please www.ambest.com/press/112808metlife.pdf.

The methodology used in determining these 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

Founded in 1899, A.M. Best Company is the world’s oldest and most
authoritative insurance rating and information source. For more information,
visit www.ambest.com.

       Copyright © 2012 by A.M. Best Company, Inc. ALL RIGHTS RESERVED.


A.M. Best Co.
Edward Kohlberg
Senior Financial Analyst
(908) 439-2200, ext. 5664
William Pargeans
Assistant Vice President
(908) 439-2200, ext. 5359
Rachelle Morrow
Senior Manager, Public Relations
(908) 439-2200, ext. 5378
Jim Peavy
Assistant Vice President, Public Relations
(908) 439-2200, ext. 5644
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