AM Best Affirms Credit Ratings of Subsidiaries of CUNA Mutual Holding Company
Both companies are life/health subsidiaries of CUNA Mutual Holding Company (CUNA Mutual) and collectively are referred to as CMFG Life Group.
AM Best has affirmed the Financial Strength Rating (FSR) of A (Excellent) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of “a+” of CMFG Life Insurance Company (CMFG Life), the lead life and annuity writer, and MEMBERS Life Insurance Company (MEMBERS Life), a life and annuity subsidiary. Both companies are life/health subsidiaries of CUNA Mutual Holding Company (CUNA Mutual) and collectively are referred to as CMFG Life Group. Concurrently, AM Best has affirmed the FSR of A (Excellent) and the Long-Term ICRs of “a+” of CUMIS Insurance Society, Inc. and CUMIS Specialty Insurance Company, Inc., property/casualty subsidiaries of CUNA Mutual that are collectively referred to as CUMIS. Additionally, AM Best has affirmed the Long-Term ICR of “bbb+” of TruStage Financial Group, Inc. (formerly CUNA Mutual Financial Group, Inc.), an intermediate holding company of CUNA Mutual. Lastly, AM Best has affirmed the Long-Term Issue Credit Rating of “a-” on the $85 million 8.5% surplus notes due 2030, issued by CMFG Life. The outlook of these Credit Ratings (ratings) is stable. All operating companies are domiciled in Iowa, but headquartered in Madison, WI.
The ratings of CMFG Life Group reflect its balance sheet strength, which AM Best categorizes as very strong, as well as its strong operating performance, neutral business profile and appropriate enterprise risk management (ERM).
CMFG Life continues to be a leading provider of life and annuity products within the credit union marketplace. CMFG Life’s balance sheet is supported by consistently increasing absolute and risk-adjusted capitalization, and modest financial and operating leverage. However, AM Best notes that there is moderate exposure to higher risk assets within the investment portfolio. The company has reported consistently strong operating results on a statutory and U.S. GAAP basis, supported by favorable growth in its annuity products issued through MEMBERS Life, as well as improvements in its legacy long-term care blocks. The company has seen some pressure recently from new business strain, primarily on their TruStage products and increased technology spend to remain highly competitive in their lines of business. The ratings acknowledge strides the group has made in executing on a refocused enterprise-wide business strategy, along with modernizing its business profile through improving its credit union members experience and a number of fintech and insurtech investments.
The ratings of CUMIS reflect its balance sheet strength, which AM Best categorizes as strongest, as well as its adequate operating performance, neutral business profile and appropriate ERM. The rating actions also reflect CUMIS’ favorable level of risk-adjusted capitalization, profitable operating results and well-established niche position in the credit union segment. The ratings also factor in the benefits CUMIS derives from the operational support, shared market opportunities and financial flexibility provided by its parent, CMFG Life. These rating factors are partially offset by the execution risk associated with growing its personal lines business, and pressure from general macroeconomic trends and varying market conditions in several of its product lines.
This press release relates to Credit Ratings that have been published on AM Best’s website. For all rating information relating to the release and pertinent 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 additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best’s Credit Ratings. For information on the proper media use of Best’s Credit Ratings and AM Best press releases, please view Guide for Media - Proper Use of Best’s Credit Ratings and AM Best Rating Action Press Releases.
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