AM Best has affirmed its credit ratings for Elips Life Insurance Company (elipsLife), which it says have been lifted by continued reinsurance and capital support from the company’s parent, Swiss Re.
The rating agency upheld its financial strength rating of A (Excellent) and long-term issuer credit rating of ‘a+’ for elipsLife, and attached a stable outlook to these ratings.
The decision reflects elipsLife’s balance sheet strength, which AM Best categorizes as very strong, as well as its marginal operating performance, limited business profile and very strong enterprise risk management
However, they also account for the company’s important role in Swiss Re’s long-term plans to grow its direct group life and health insurance business in the US.
elipsLife is an indirect subsidiary of Swiss Re and is expected to continue to benefit from quota share reinsurance protection from the group.
In 2019, a one-off reinsurance allowance from Swiss Re assisted elipsLife in the coverage of upfront investment costs.
The company is also set to be Swiss Re’s primary direct writer of group life and health insurance in the US, and will follow the already established business model in Europe.
Despite the early stages of business development, elipsLife is considered to have made significant progress in developing distribution relationships and will likely achieve profitability in the near future, according to AM Best.
