AM Best Places Credit Ratings of Cigna Life Insurance New Zealand Limited Under Review With Positive Implications

Rhea-AI Summary

AM Best has placed the Financial Strength Rating of A (Excellent) and Long-Term Issuer Credit Rating of 'a' (Excellent) of Cigna Life Insurance New Zealand Limited (CLINZ) under review with positive implications. This follows Cigna Corporation's announcement on October 7, 2021, regarding the sale of its life and supplemental benefits businesses to Chubb Limited for USD 5.75 billion. The review will assess the impact of this acquisition, including potential changes in ratings and support from the new parent company, Chubb.

Positive

• Cigna's strategic decision to sell its life and supplemental benefits businesses to Chubb could enhance CLINZ's credit fundamentals.
• The planned integration within the Chubb group may provide additional resources and support for CLINZ.

Negative

• The ratings are under review and may lead to uncertainty during the transition period.
• Potential regulatory hurdles and customary closing conditions could delay the completion of the transaction.

SINGAPORE--(BUSINESS WIRE)-- AM Best has placed under review with positive implications the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Rating of “a” (Excellent) of Cigna Life Insurance New Zealand Limited (CLINZ) (New Zealand).

These Credit Rating (rating) actions follow the announcement on 7 October 2021, that Cigna Corporation [NYSE:CI], CLINZ’s ultimate parent, has entered into a definitive agreement to sell its life, accident and supplemental benefits businesses in seven countries, including CLINZ, to Chubb Limited (Chubb group) [NYSE:CB] for USD 5.75 billion. The transaction, which is subject to required regulatory approvals and customary closing conditions, is expected to be completed in 2022.

The ratings have been placed under review with positive implications as AM Best needs to assess the impact of the planned acquisition on CLINZ’s credit fundamentals, including any potential increase in rating enhancement that could arise from the change in ownership. In addition, AM Best will need to consider the planned integration of CLINZ within the Chubb group, any expected changes in strategy and any implicit or explicit support to be provided by the new parent.

The ratings will remain under review pending completion of the transaction, and until AM Best can fully assess the post-acquisition credit rating fundamentals of CLINZ.

Ratings are communicated to rated entities prior to publication. Unless stated otherwise, the ratings were not amended subsequent to that communication.

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 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 specialising 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.

Copyright © 2021 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.

View source version on businesswire.com: https://www.businesswire.com/news/home/20211011005573/en/

Sin Yee Chuah

Financial Analyst

+65 6303 5022

sinyee.chuah@ambest.com

Christopher Sharkey

Manager, Public Relations

+1 908 439 2200, ext. 5159

christopher.sharkey@ambest.com

Myles Gould

Director, Analytics

+44 207 397 0304

myles.gould@ambest.com

Jim Peavy

Director, Communications

+1 908 439 2200, ext. 5644

james.peavy@ambest.com

Source: AM Best

FAQ

What is the current rating of Cigna Life Insurance New Zealand Limited (CI)?

AM Best has placed CLINZ's Financial Strength Rating of A (Excellent) and Long-Term Issuer Credit Rating of 'a' (Excellent) under review with positive implications.

When was the acquisition of Cigna Life Insurance New Zealand Limited announced?

The acquisition was announced on October 7, 2021.

Who is acquiring Cigna Life Insurance New Zealand Limited (CI)?

Cigna Life Insurance New Zealand Limited is being acquired by Chubb Limited.

What is the value of the transaction involving Cigna Life Insurance New Zealand Limited?

The transaction is valued at USD 5.75 billion.

What are the implications of the review of CLINZ's ratings?

The review aims to assess the impact of the acquisition on CLINZ's credit fundamentals and any support from Chubb.