Quotes Life Assurance

OLDWICK, N.J., Nov 18, 2011 (BUSINESS WIRE) –
A.M. Best Co. has upgraded the financial strength rating to A
(Excellent) from A- (Excellent) and issuer credit ratings to “a” from
“a-” of Continental Life Insurance Company of Brentwood,
Tennessee (CLIC) and its subsidiary, American Continental
Life Insurance Company (ACIC) (both domiciled in Brentwood, TN). All
ratings have been removed from under review with positive implications
and assigned a stable outlook.

The upgrading of the ratings for CLIC and ACIC reflect both companies’
premium and membership growth, the adequate risk-adjusted capital to
support their growing membership base and the new parent company, Aetna
Inc.’s capital support.

Both companies’ consolidated net premiums written have grown over the
past five years; and the majority of the growth is derived from new
Medicare Supplement sales written through ACIC. Risk-adjusted capital
levels are expected to decline over the near term as the net premiums
written trend continues to grow and near term losses pressure capital
growth. A.M. Best expects capital support from Aetna Inc. to offset the
strain of new business and maintain risk-based capital at or exceeding
historical levels at CLIC.

Offsetting rating factors include the group’s decline in earnings,
strong competitive pressure in the Medicare Supplement marketplace and
the potential impact proposed legislative changes to the Medicare system
would have on the group’s Medicare supplement earnings. Over the past
five years, the consolidated statutory earnings of CLIC with ACIC have
decreased during a period of strong growth. This decline is reflective
of the intensely competitive Medicare Supplement marketplace and higher
costs to acquire new business. A.M. Best will be monitoring legislative
and regulatory changes to the insurance industry, including the progress
of the bill recently introduced to the House of Representatives and
Senate that would require Medigap insurers to have a required minimum
loss ratio, which could result in margin compression.

Factors that could result in a positive rating action include: full
integration into Aetna Inc.’s strategic plan including utilization of
the Aetna Inc. brand name as well as CLIC and ACIC’s becoming
significant contributors to the parent’s earnings.

Factors that could result in a negative rating action include: lack of
future parental support; less of a focus on the Medicare Supplement
business on a corporate (Aetna Inc.) basis; significant deterioration of
the operating performance of the individual entities or the potential
impact of proposed legislative changes to the Medicare system.

The principal methodology used in determining these ratings is Best’s
Credit Rating Methodology — Global Life and Non-Life Insurance Edition,
which provides a comprehensive explanation of A.M. Best’s rating process
and highlights the different rating criteria employed. Additional key
criteria utilized include: “Rating Health Insurance Companies”;
“Understanding BCAR for Life/Health Insurers”; “Rating Members of
Insurance Groups”; “Risk Management and the Rating Process for Insurance
Companies”; and “Assessing Country Risk.” Methodologies can be found at
www.ambest.com/ratings/methodology .

Founded in 1899, A.M. Best Company is the world’s oldest and most
authoritative insurance rating and information source. For more
information, visit
www.ambest.com .

Copyright (C) 2011 by A.M. Best Company, Inc. ALL RIGHTS
RESERVED.

SOURCE: A.M. Best Co.

        A.M. Best Co.
        Wayne Kaminski, 908-439-2200, ext. 5061
        Senior Financial Analyst
        wayne.kaminski@ambest.com
        or
        Sally Rosen, 908-439-2200, ext. 5280
        Managing Senior Financial Analyst
        sally.rosen@ambest.com
        or
        Carole Lovell, 908-439-2200, ext. 5445
        Public Relations Associate
        carole.lovell@ambest.com
        or
        Jim Peavy, 908-439-2200, ext. 5644
        Assistant Vice President, Public Relations
        james.peavy@ambest.com

Copyright Business Wire 2011

OLDWICK, N.J., Nov 18, 2011 (BUSINESS WIRE) –
A.M. Best Co. has upgraded the financial strength rating to A
(Excellent) from A- (Excellent) and issuer credit ratings to “a” from
“a-” of Continental Life Insurance Company of Brentwood,
Tennessee (CLIC) and its subsidiary, American Continental
Life Insurance Company (ACIC) (both domiciled in Brentwood, TN). All
ratings have been removed from under review with positive implications
and assigned a stable outlook.

The upgrading of the ratings for CLIC and ACIC reflect both companies’
premium and membership growth, the adequate risk-adjusted capital to
support their growing membership base and the new parent company, Aetna
Inc.’s capital support.

Both companies’ consolidated net premiums written have grown over the
past five years; and the majority of the growth is derived from new
Medicare Supplement sales written through ACIC. Risk-adjusted capital
levels are expected to decline over the near term as the net premiums
written trend continues to grow and near term losses pressure capital
growth. A.M. Best expects capital support from Aetna Inc. to offset the
strain of new business and maintain risk-based capital at or exceeding
historical levels at CLIC.

Offsetting rating factors include the group’s decline in earnings,
strong competitive pressure in the Medicare Supplement marketplace and
the potential impact proposed legislative changes to the Medicare system
would have on the group’s Medicare supplement earnings. Over the past
five years, the consolidated statutory earnings of CLIC with ACIC have
decreased during a period of strong growth. This decline is reflective
of the intensely competitive Medicare Supplement marketplace and higher
costs to acquire new business. A.M. Best will be monitoring legislative
and regulatory changes to the insurance industry, including the progress
of the bill recently introduced to the House of Representatives and
Senate that would require Medigap insurers to have a required minimum
loss ratio, which could result in margin compression.

Factors that could result in a positive rating action include: full
integration into Aetna Inc.’s strategic plan including utilization of
the Aetna Inc. brand name as well as CLIC and ACIC’s becoming
significant contributors to the parent’s earnings.

Factors that could result in a negative rating action include: lack of
future parental support; less of a focus on the Medicare Supplement
business on a corporate (Aetna Inc.) basis; significant deterioration of
the operating performance of the individual entities or the potential
impact of proposed legislative changes to the Medicare system.

The principal methodology used in determining these ratings is Best’s
Credit Rating Methodology — Global Life and Non-Life Insurance Edition,
which provides a comprehensive explanation of A.M. Best’s rating process
and highlights the different rating criteria employed. Additional key
criteria utilized include: “Rating Health Insurance Companies”;
“Understanding BCAR for Life/Health Insurers”; “Rating Members of
Insurance Groups”; “Risk Management and the Rating Process for Insurance
Companies”; and “Assessing Country Risk.” Methodologies can be found at
www.ambest.com/ratings/methodology .

Founded in 1899, A.M. Best Company is the world’s oldest and most
authoritative insurance rating and information source. For more
information, visit
www.ambest.com .

Copyright (C) 2011 by A.M. Best Company, Inc. ALL RIGHTS
RESERVED.

SOURCE: A.M. Best Co.

        A.M. Best Co.
        Wayne Kaminski, 908-439-2200, ext. 5061
        Senior Financial Analyst
        wayne.kaminski@ambest.com
        or
        Sally Rosen, 908-439-2200, ext. 5280
        Managing Senior Financial Analyst
        sally.rosen@ambest.com
        or
        Carole Lovell, 908-439-2200, ext. 5445
        Public Relations Associate
        carole.lovell@ambest.com
        or
        Jim Peavy, 908-439-2200, ext. 5644
        Assistant Vice President, Public Relations
        james.peavy@ambest.com

Copyright Business Wire 2011