AM Best Downgrades Mountain Life Insurance Company Ratings
AM Best, headquartered in Oldwick, N.J., announced a significant downgrade in the Financial Strength Rating and Long-Term Issuer Credit Rating for Mountain Life Insurance Company, based in Lexington, Kentucky. The financial strength rating now stands at B-, down from B, while the long-term issuer credit rating has dropped to "bb-" from "bb". Both ratings are currently under review with developing implications.
The revised ratings reflect Mountain Life Insurance Company's adequate balance sheet, marginal operational performance, and an enterprise risk management (ERM) strategy considered suboptimal. The review follows ongoing litigation concerning the holding company's ultimate controlling party (UCP) and other stakeholders regarding the ownership structure. Successful legal action against the UCP could nullify the existing capital maintenance agreement (CMA), which relies on UCP support. Should this occur, prospective new ownership is expected to create a fresh CMA. The ratings will remain under review until the resolution of the ownership dispute.
Furthermore, the downgrades draw attention to Mountain Life's underwhelming ERM framework, which has not evolved with the heightened risk profile following its acquisition by MeM Capital LLC. The ownership controversy, increased financial leverage, and substantial interest expenses further exacerbate the marginal ERM assessment.
Impact on the Insurance Sector
Insurance industry professionals can access detailed ratings via AM Best's website, offering individual ratings and pertinent disclosures. For a comprehensive understanding of rating methodologies and implications, stakeholders are encouraged to visit AM Best's Recent Rating Activity page, which serves as a resource for regulatory compliance requirements and payer-provider dynamics.
As a globally recognized credit rating agency and data analytics provider, AM Best plays a pivotal role in the insurance sector. Operating across over 100 countries, the agency maintains regional offices in key financial hubs such as London and Singapore, ensuring expertise in underwriting, claims assessment, and risk management. For more information, visit www.ambest.com.
For further inquiries, please contact:
- Tyler Samani, Financial Strength Analyst, +1 908 882 2296, tyler.samani@ambest.com
- Kate Steffanelli, Associate Director, +1 908 882 2337, kate.steffanelli@ambest.com
- Christopher Sharkey, Associate Director, Public Relations, +1 908 882 2310, christopher.sharkey@ambest.com
- Al Slavin, Senior Public Relations Specialist, +1 908 882 2318, al.slavin@ambest.com