CORRECTING and REPLACING A.M. Best Affirms Ratings of Cigna Life Insurance
Company of Europe S.A.-N.V. and Cigna Europe Insurance Company S.A.-N.V.
CORRECTION…by A.M. Best Company, Inc.
LONDON -- January 30, 2013
In the fourth paragraph the names forVanbreda and First Assist should read:
Vanbreda International and First Assist Insurance Services Ltd. (sted Vanbreda
and First Assist).
The corrected release reads:
A.M. BEST AFFIRMS RATINGS OF CIGNA LIFE INSURANCE COMPANY OF EUROPE S.A.-N.V.
AND CIGNA EUROPE INSURANCE COMPANY S.A.-N.V.
A.M. Best Europe – Rating Services Limited has affirmed the financial strength
rating of A (Excellent) and the issuer credit ratings of “a” of Cigna Life
Insurance Company of Europe S.A.-N.V. (CLICE) and its sister company, Cigna
Europe Insurance Company S.A.-N.V. (CEIC) (both domiciled in Belgium). The
outlook for both ratings remains stable.
CLICE’s ratings reflect the implicit support it receives from its ultimate
parent company, Cigna Corporation (Cigna) (Philadelphia, PA), along with its
strong and supportive level of risk-adjusted capitalisation, robust business
profile and improving underwriting performance. CEIC’s ratings reflect its
strong level of integration with CLICE, together with its solid level of
CLICE's current and prospective risk-adjusted capitalisation is expected to
remain strong and supportive of its current ratings. Increasing capital
requirements primarily from new business but also organic growth in 2011 were
matched by a capital injection from Cigna, who is expected to remain
supportive of CLICE’s business plans in the near future.
Cigna channels its European business through its two European insurance
subsidiaries, CLICE and CEIC. Although the majority of gross premiums are
written directly by CLICE, regulations in various jurisdictions mean that
CEIC—as a non-life carrier—is essential for Cigna’s strategy. CLICE
strengthened its business profile with the internalisation of both the
Vanbreda International and First Assist Insurance Services Ltd. businesses
acquired by Cigna, and its gross written premiums are expected to reach
approximately EUR 715 million (USD 960 million) on actual 2012 results, an 80%
increase from 2011. A.M. Best expects CLICE’s overall portfolio to increase by
around 10% annually in the coming two years despite its life, accident and
supplementary businesses being put in run off in 2012. The global health
benefits business of CLICE is its most significant and has been strengthened
by Cigna’s acquisition of Vanbreda International. In 2012, this business
accounted for over 50% of gross written premiums.
CLICE is expected to improve its underwriting performance in 2012 and onward
as well as return to a lower combined ratio, compared to a one-off of 101.7%
in 2011, following challenging market conditions and some non-recurring
losses. Actual 2012 loss and combined ratios are expected to improve for most
lines, except for certain segments, where CLICE is expecting to increase
profitability margins in the near term. Despite an anticipated deterioration
in earnings in 2012, CEIC is expected to continue to contribute positively to
the Cigna group going forward, with a forecast pre-tax profit ranging from EUR
1-2 million (USD 1.35–2.7 million) for 2013 and 2014.
Further positive rating developments are unlikely at this time.
A significant deterioration in risk-adjusted capitalisation, future earnings
below expectations, deterioration in the ratings of both CLICE and CEIC’s
ultimate parent or a reduction in parental support would likely add negative
pressure to CLICE and CEIC’s ratings.
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. Key criteria utilised include: “Risk Management and the Rating
Process for Insurance Companies”; “Rating Members of Insurance Groups”; and
“Understanding Universal BCAR”. Best’s Credit Rating Methodology can be found
In accordance with Regulation (EC) No. 1060/2009, the following is a link to
required disclosures: A.M. Best Europe - Rating Services Limited Supplementary
A.M. Best Europe – Rating Services Limited is a subsidiary of A.M. Best
Company. Founded in 1899, A.M. Best Company is the world's oldest and most
authoritative insurance rating and information source. For more information,
Copyright © 2013 by A.M. Best Company, Inc. ALL RIGHTS RESERVED.
A.M. Best Company, Inc.
Anandi Nangy-Kotecha, +(44) 207 397 0271
Carlos Wong-Fupuy, +(44) 207 397 0287
Rachelle Morrow, +(1) 908 439 2200, ext. 5378
Senior Manager, Public Relations
Jim Peavy, +(1) 908 439 2200, ext. 5644
Assistant Vice President, Public Relations
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