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Hartford Financial & Units' Ratings Affirmed by A.M Best
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The Hartford Financial Services Group, Inc. (HIG - Free Report) and its subsidiaries recently received rating action from A.M. Best. The rating giant affirmed the Long-Term Issuer Credit Rating (Long-Term ICR) of “a-” and the Long- and Short-Term Issue Credit Ratings (Long-Term IR; Short-Term IR) of Hartford Financial.
A.M. Best reiterated the Financial Strength Rating (FSR) of A+ (Superior) and Long-Term ICR of “aa-” of Hartford Fire Insurance Company and its pooling subsidiaries and affiliates, collectively known as the Hartford Insurance Pool. Concurrently, the rating giant maintained stable outlook for these Credit Ratings.
A.M. Best also affirmed the FSR of A (Excellent) and the Long-Term ICR of “a” of Hartford Life and Accident Insurance Company. It also reiterated the FSR of A- and the Long-Term ICR of “a-” of Hartford Life Insurance Company and Hartford Life and Annuity Insurance Company, collectively referred to as Hartford Life. The outlook for these ratings also remained stable.
These apart, A.M. Best also affirmed the Long-Term ICR of “bbb” and the Long-Term IRs of Hartford Life, Inc. (“HLI”), the intermediate parent of HLA and Hartford Life. The outlook for these ratings is stable.
This rating action clearly reflects the rating giant’s optimism over Hartford Financial’s performance. These ratings justify its solid risk-adjusted capitalization, strong underwriting results and consistent profitability that position it well in the property-casualty industry. Management has already started taking several operating initiatives to focus operations on small to middle commercial markets and personal lines business. It also plans to increase the number of insured members in specialty casualty markets.
Well reflective of these tailwinds, year to date, this Zacks Rank #3 (Hold) stock has rallied almost 11%, outpacing the Zacks Multi Line Insurance industry’s gain of 6%.
However, A.M Best believes that the stockholder dividends paid during the last five years have constrained organic surplus growth. The company’s volatile operating performance due to catastrophic events is also considered a major headwind. In addition, weak private passenger auto business, driven by increases in frequency and severity of bodily injury claims is also an area of concern. The company’s results are also likely to have been impacted by adverse loss reserve development in recent calendar years related to its asbestos and environmental liabilities.
The rating reiteration of HLI’s might have stemmed from continued decline in balance sheet risk of its subsidiary’s annuity business, favorable operating earnings and dividend capacity of its subsidiaries. Nevertheless, Hartford Financial’s debt-to-total capital ratio and interest coverage ratios are within A.M. Best’s guidelines for its current ratings. The rating giant anticipates that the company will maintain a solid liquidity to support any potential capital needs of its operating subsidiaries.
Reinsurance Group deals in reinsurance business. The company has delivered positive surprises in three of the last four quarters with an average beat of 5.08%.
Cigna provides insurance plus related products and services in the United States and internationally. The company has delivered positive surprises in three of the last four quarters with an average beat of 1.35%.
FBL Financial sells individual life insurance and annuity products. The company has delivered positive surprises in two of the last four quarters with an average beat of 1.98%.
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Hartford Financial & Units' Ratings Affirmed by A.M Best
The Hartford Financial Services Group, Inc. (HIG - Free Report) and its subsidiaries recently received rating action from A.M. Best. The rating giant affirmed the Long-Term Issuer Credit Rating (Long-Term ICR) of “a-” and the Long- and Short-Term Issue Credit Ratings (Long-Term IR; Short-Term IR) of Hartford Financial.
A.M. Best reiterated the Financial Strength Rating (FSR) of A+ (Superior) and Long-Term ICR of “aa-” of Hartford Fire Insurance Company and its pooling subsidiaries and affiliates, collectively known as the Hartford Insurance Pool. Concurrently, the rating giant maintained stable outlook for these Credit Ratings.
A.M. Best also affirmed the FSR of A (Excellent) and the Long-Term ICR of “a” of Hartford Life and Accident Insurance Company. It also reiterated the FSR of A- and the Long-Term ICR of “a-” of Hartford Life Insurance Company and Hartford Life and Annuity Insurance Company, collectively referred to as Hartford Life. The outlook for these ratings also remained stable.
These apart, A.M. Best also affirmed the Long-Term ICR of “bbb” and the Long-Term IRs of Hartford Life, Inc. (“HLI”), the intermediate parent of HLA and Hartford Life. The outlook for these ratings is stable.
This rating action clearly reflects the rating giant’s optimism over Hartford Financial’s performance. These ratings justify its solid risk-adjusted capitalization, strong underwriting results and consistent profitability that position it well in the property-casualty industry. Management has already started taking several operating initiatives to focus operations on small to middle commercial markets and personal lines business. It also plans to increase the number of insured members in specialty casualty markets.
Well reflective of these tailwinds, year to date, this Zacks Rank #3 (Hold) stock has rallied almost 11%, outpacing the Zacks Multi Line Insurance industry’s gain of 6%.
However, A.M Best believes that the stockholder dividends paid during the last five years have constrained organic surplus growth. The company’s volatile operating performance due to catastrophic events is also considered a major headwind. In addition, weak private passenger auto business, driven by increases in frequency and severity of bodily injury claims is also an area of concern. The company’s results are also likely to have been impacted by adverse loss reserve development in recent calendar years related to its asbestos and environmental liabilities.
The rating reiteration of HLI’s might have stemmed from continued decline in balance sheet risk of its subsidiary’s annuity business, favorable operating earnings and dividend capacity of its subsidiaries. Nevertheless, Hartford Financial’s debt-to-total capital ratio and interest coverage ratios are within A.M. Best’s guidelines for its current ratings. The rating giant anticipates that the company will maintain a solid liquidity to support any potential capital needs of its operating subsidiaries.
Stocks to Consider
Some better-ranked stocks in the insurance industry include Reinsurance Group of America, Incorporated (RGA - Free Report) , Cigna Corporation (CI - Free Report) and FBL Financial Group, Inc. . Each of the stock carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Reinsurance Group deals in reinsurance business. The company has delivered positive surprises in three of the last four quarters with an average beat of 5.08%.
Cigna provides insurance plus related products and services in the United States and internationally. The company has delivered positive surprises in three of the last four quarters with an average beat of 1.35%.
FBL Financial sells individual life insurance and annuity products. The company has delivered positive surprises in two of the last four quarters with an average beat of 1.98%.
Will You Make a Fortune on the Shift to Electric Cars?
Here's another stock idea to consider. Much like petroleum 150 years ago, lithium power may soon shake the world, creating millionaires and reshaping geo-politics. Soon electric vehicles (EVs) may be cheaper than gas guzzlers. Some are already reaching 265 miles on a single charge.
With battery prices plummeting and charging stations set to multiply, one company stands out as the #1 stock to buy according to Zacks research.
It's not the one you think.
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