AM Best has affirmed the Financial Strength Rating (FSR) of A (Excellent) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of "a+" (Excellent) of the key life/health subsidiaries of Globe Life Inc. (Globe Life) (headquartered in McKinney, TX) (NYSE:GL). Concurrently, AM Best has affirmed the Long-Term ICR of "bbb+" (Good) of Globe Life. AM Best also has affirmed the Short- and Long-Term Issue Credit Ratings (Short-Term IR; Long-Term IR) and the indicative Long-Term IRs on the securities of Globe Life. The outlook of these Credit Ratings (ratings) is stable. (See below for a detailed listing of these companies and ratings.)
The ratings reflect Globe Life's balance sheet strength, which AM Best assesses as strong, as well as its very strong operating performance, favorable business profile and appropriate enterprise risk management (ERM).
Globe Life's risk-based capital is assessed within the strong category, as measured by Best's Capital Adequacy Ratio (BCAR). On a statutory basis, year-end 2024 capital and surplus increased. Surplus growth is metered by continued dividend payments to the holding company to support operations and the share repurchase program. Globe Life's investment portfolio, which is managed on a consolidated basis, is primarily composed of public, investment-grade bonds with an increasing allocation to Schedule BA assets in the form of limited partnerships. Liquidity is enhanced by Federal Home Loan Bank borrowing, commercial paper and a new pre-capitalized trust securities (P-CAP) program. Reinsurance is used minimally and involves high quality counterparties. Globe Life's financial leverage and coverage ratios remain within tolerance for its current ratings.
Globe Life consistently has reported very strong earnings, return metrics, steady premium income and favorable investment income, which supports the group's operating performance assessment. In 2024, earnings were very strong again, attributable to higher premium volumes and reduced mortality experience. Globe Life has reported better underwriting margins from most of its subsidiaries as part of a strategic focus to increase operational efficiencies and margins. The group's health segment also contributed to positive earnings in 2024. Investment income at year-end 2024 was more than $1 billion, benefiting from improvements in bond net yields. Additionally, GAAP results also have been stable and show favorable trends in revenue, net income and in-force premium.
Globe Life is geographically diversified with a robust product offering that includes life and supplemental health insurance products for middle class and retired individuals. Globe Life's products are offered through agents and direct-to-consumer distribution. Globe Life focuses on high volume, low face amount policies across all subsidiaries. Most agents are exclusive to Globe Life and sell relatively low-risk products. Additionally, Globe Life continues to expand its formalized ERM program. The group's ERM framework evaluates its risk appetite and tolerances while evaluating risk components, including operational and event risks. AM Best believes that the group's ERM is appropriate given its risk profile.
The FSR of A (Excellent) and the Long-Term ICRs of "a+" (Excellent) have been affirmed with stable outlooks for the following life/health subsidiaries of Globe Life:
- American Income Life Insurance Company
- Globe Life and Accident Insurance Company
- Liberty National Life Insurance Company
- United American Insurance Company
- Globe Life Insurance Company of New York
- National Income Life Insurance Company
- Family Heritage Life Insurance Company of America
The following Short-Term IR has been affirmed:
Globe Life Inc.—
-- AMB-1 (Outstanding) on commercial paper
The following Long-Term IRs have been affirmed with stable outlooks:
Globe Life Inc.—
-- "bbb+" (Good) on $550 million 4.55% senior unsecured notes, due 2028
-- "bbb+" (Good) on $400 million 2.15% senior unsecured, due 2030
-- "bbb+" (Good) on $450 million 5.85% senior unsecured, due 2034
-- "bbb-" (Good) on $325 million 4.25% junior subordinated debentures, due 2061
-- "bbb-" (Good) on $125 million 5.275% junior subordinated debentures, due 2057
The following indicative Long-Term IRs available under the shelf registration have been affirmed with stable outlooks:
Globe Life Inc. —
-- "bbb+" (Good) on senior unsecured debt
-- "bbb" (Good) on subordinated debt
-- "bbb-" (Good) on preferred stock
This press release relates to Credit Ratings that have been published on AM Best's website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best's Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best's Credit Ratings. For information on the proper use of Best's Credit Ratings, Best's Performance Assessments, Best's Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best's Ratings & Assessments.
AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.
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Brent DeAngelis
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