AM Best Affirms Mutual of Omaha's Financial Strength Rating and Outlook
AM Best has affirmed its Financial Strength Rating of A+ (Superior) for Mutual of Omaha Insurance Company and its subsidiaries, including United of Omaha Life Insurance Company, Companion Life Insurance Company, and United World Life Insurance Company. Additionally, AM Best has upheld the Long-Term Issue Credit Ratings (Long-Term IRs) of “a” (Excellent) on Mutual of Omaha’s surplus notes, with a stable outlook. The company is headquartered in Omaha, NE.
The affirmations indicate Mutual of Omaha's strong balance sheet, characterized by robust risk-adjusted capitalization as measured by the Best’s Capital Adequacy Ratio (BCAR). Solid liquidity is ensured through an unsecured credit line and access to Federal Home Loan Bank facilities. Although operating leverage has increased due to the Funding Agreement Backed Notes program, it remains within acceptable limits set by AM Best. By the end of 2025, financial leverage was reported at 22.6%, with interest coverage at 10 times earnings, reflecting a solid financial position bolstered by a diverse and quality investment portfolio.
On April 1, 2026, Mutual of Omaha transitioned to a mutual holding company structure, forming the Mutual of Omaha Holding Company. This development is anticipated to enhance financial flexibility, offering new opportunities to issue debt instruments within capital markets.
Improvements in earnings and return metrics, alongside consistent premium growth, highlight the company's financial strength. Despite initial costs of new sales, earnings diversification across multiple business lines supports this positive trajectory. The company boasts a strong market presence, notably in Medicare Supplement products, and occupies leading positions across a variety of insurance products.
Mutual of Omaha's enterprise risk management program is robust, integrating capital modeling and risk assessment into strategic operations. The company actively manages its risk appetite and expands cyber risk capabilities, demonstrating a commitment to a comprehensive risk culture.
AM Best affirmed the Long-Term IRs with a stable outlook for Mutual of Omaha Insurance Company’s $300 million 6.144% surplus notes due 2064, $300 million 6.80% surplus notes due 2036, and $300 million 6.95% surplus notes due 2040.
As a leading credit rating agency, AM Best specializes in the insurance sector, offering rating, news publishing, and data analytics services globally from its regional offices worldwide.