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Partners gets an upgrade from AM Best

Partners Life has had its credit rating upgraded on the back of strong earnings and an investment from Blackstone Group.

Thursday, March 23rd 2017, 12:53PM 1 Comment

AM Best has upgraded Partners credit rating from bbb to bbb+ and it has affirmed the Financial Strength Rating of B++ (Good).

"The rating actions reflect significant improvement in Partners Life’s capital position, due to continued strong earnings and significant capital contribution. In addition, the $200 million investment from the Blackstone Group has improved Partners Life’s financial flexibility," AM Best says..

"Partners Life continues to maintain its status as New Zealand’s second-largest life insurer in terms of new business market share. Its continued growth is due to a number of competitive advantages, including a more-efficient cost structure, strong recognition within the financial adviser channel and expertise within its core business.

Partners Life managing director Naomi Ballantyne says, “We are pleased to have received an uplift of our Issuer Credit Rating. As a young company our rating was always constrained. Having now reached our five-year milestone, the continued strong earnings performance of the company, coupled with Blackstone’s $200 million capital commitment, has led AM Best to this ratings upgrade.”

Sean Kam, Partners Life CFO, says, “Blackstone’s investment gives us incredible financial flexibility. The investment was completed late last year and we are working through our plans to best use the capital. We anticipate that AM Best will give us further credit for this as we begin to deploy the capital over the next 12 to 18 months.”

AM Best says "a major offsetting rating factor is the quality of capital, stemming from high reinsurance dependency as a result of utilising reinsurance to manage its cash flow requirements. Furthermore, AM Best remains cautious of Partners Life’s inherent distribution concentration risk, since it relies on a limited number of dealer groups to generate a large portion of its new business premiums."

Tags: AM Best Naomi Ballantyne Partners Life

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Comments from our readers

On 23 March 2017 at 2:26 pm Donald said:
It is my belief a bad egg will always be exactly that no matter what application forms are used. To some degree the Partners application is not dissimilar to a short form app and this will have a place in certain instances and as mentioned above has a number of sign off's required. However I favour the certainty at claim time for my clients with fully under written client policies. It is the lack of understanding of the purpose of the fast app that may see some advisers unwittingly compromising their clients.

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