AM Best has affirmed the ‘A’ (Excellent) Financial Strength Rating and the ‘a+’ (Excellent) Long-Term Issuer Credit Rating for Ameriprise Captive Insurance Company (ACIC), an Ameriprise Financial, Inc. subsidiary. The outlook for the captive’s credit ratings remains ‘stable’. The ratings of ACIC, which is domiciled in Burlington, Vermont, reflect its very strong balance sheet strength, strong operating performance, limited business profile and appropriate enterprise risk management (ERM). The rating agency notes that ACIC benefits from rating enhancement due to its strategic importance as a single-parent captive insurance provider to its parent company, Ameriprise. ACIC’s business profile is assessed as limited due to its narrow market focus, as it serves only its parent for a limited amount of exposure. The captive provides various coverages to Ameriprise in the form of errors and omissions policies, a workers’ compensation deductible reimbursement policy, fidelity bonds and property terrorism (nuclear, biological, chemical or radiological). AM Best states that the captive has generated strong operating performance, which is demonstrated by its five-year average pre-tax return on revenue and equity ratios that compare favourably with the averages for AM Best’s commercial casualty composite. Additionally, ACIC benefits from a very low expense ratio. Concurrently, AM Best also affirmed the FSR of ‘A+’ (Superior) and the Long-Term ICRs of ‘aa-’ (Superior) for Ameriprise’s key life/health subsidiaries, RiverSource Life Insurance Company and RiverSource Life Insurance Co. of New York, which are collectively known as Ameriprise Financial Group. The rating agency affirms the Long-Term ICR of ‘a-’ (Excellent) and the existing Long-Term Issue Credit Ratings of Ameriprise Financial, Inc. The outlook of all credit ratings is ‘stable’.
