AM Best Reviews Credit Ratings for Banner Life and William Penn Amid Meiji Yasuda Acquisition
AM Best has maintained the 'under review with developing implications' status for the Financial Strength Rating of A+ (Superior) and Long-Term Issuer Credit Ratings of 'aa-' (Superior) for Banner Life Insurance Company (BLIC) and William Penn Life Insurance Company of New York. Both companies exhibit very strong balance sheet strength, strong operating performance, favorable business profiles, and appropriate enterprise risk management, which are key factors supporting their ratings.
The credit ratings action follows the announcement on February 7, 2025, of Legal & General Group Plc's agreement to sell its U.S. protection business, including BLIC and William Penn-NY, to Meiji Yasuda Life Insurance Company. The transaction, valued at $2.3 billion and expected to close by the end of 2025, also involves a strategic partnership that positions Meiji with a 20% interest in Legal & General's U.S. pension risk transfer (PRT) business.
Under the strategic partnership, Legal & General will maintain an 80% share of new and existing U.S. PRT business through reinsurance agreements and will manage assets. BLIC and William Penn-NY primarily focus on term life insurance and PRT transactions, and their roles within the Meiji organization are expected to evolve as the transaction progresses.
The transaction reflects Meiji's broader international growth strategy to expand its presence in the U.S. life insurance market. AM Best will continue to monitor developments relating to the transaction and its strategic importance to Meiji, with implications for the credit ratings of the involved entities.
This rating review emphasizes the ongoing integration considerations and financial assessments necessary in major insurance acquisitions, underlining the impact of such transactions on insurer credit profiles and risk management approaches. The maintenance of strong ratings amidst the ownership change signals confidence in the companies' operational and financial stability through the transition period.
AM Best, a global credit rating agency specialized in the insurance sector, provides ongoing analysis and updates on these ratings and related market developments. The assessments consider enterprise risk management, balance sheet strength, and business profile in the context of evolving ownership and strategic partnerships.