OLDWICK, NJ–(BUSINESS WIRE)–AM Finest has affirmed the Monetary Energy Score (FSR) of A (Wonderful) and the Lengthy-Time period Issuer Credit score Score (Lengthy-Time period ICR) of “a+” (Wonderful) of RBC Life Insurance coverage Firm (RBC Life) ( Mississauga, Ont.). The outlook of those credit score scores (scores) is secure.
The scores replicate RBC Life’s stability sheet energy, which AM Finest assesses as very sturdy, in addition to its sturdy working efficiency, impartial enterprise profile and applicable enterprise danger administration.
RBC Life continues to provide favorable working leads to its core particular person life enterprise phase, regardless of the implications of a worldwide pandemic atmosphere, with added profitability from its group life, well being, and annuity traces. These optimistic working outcomes have been maintained over the long run, which has contributed to the expansion of an already favorable stability sheet.
RBC Life operates because the Canadian life insurance coverage operation of its final mother or father, Royal Financial institution of Canada (RBC) [TSX and NYSE: RY], beneath RBC Insurance coverage, the model title for the insurance coverage working entities of RBC. RBC Life’s earnings in fiscal 12 months 2021 remained sturdy regardless of falling barely after attaining 5 consecutive years of file web revenue in 2020. Earlier outcomes had been largely attributed to extra favorable than projected investment-related beneficial properties from a US bond diversification technique. The corporate considerably expanded premiums written in its group annuity and wealth traces of enterprise starting in 2017, additional diversifying its general e book of enterprise and persevering with to have a big presence in Canada’s pension danger switch market by 2021. As well as, the corporate’s risk-adjusted Capitalization, measured by Finest’s Capital Adequacy Ratio (BCAR), improved to the strongest degree starting in 2019, supported by additional substantial progress in absolute capital from retained earnings and has been maintained at such degree ever since.
Partially offsetting these optimistic ranking elements are the challenges RBC Life nonetheless faces whereas positioning itself to extend market share in Canada’s aggressive insurance coverage atmosphere, which is dominated by a number of bigger organizations. Regardless of the varied product portfolio providing common life, conventional life, particular person and group well being, wealth and group annuity, RBC Life has nonetheless been largely depending on its particular person life insurance coverage enterprise for earnings as different traces proceed to fluctuate by 12 months.
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