A.M. Best Affirms Ratings of Americo Life, Inc. and Its Subsidiaries; Upgrades Investors...

A.M. Best Affirms Ratings of Americo Life, Inc. and Its Subsidiaries; Upgrades Investors Life Insurance Company of North America

OLDWICK, N.J.--(Business Wire)--
A.M. Best Co. has affirmed the financial strength rating (FSR) of
A- (Excellent) and the issuer credit rating (ICR) of "a-" of Americo
Financial Life and Annuity Insurance Company (AFL) (Dallas, TX) and
its key life/health affiliate. (See link below for a detailed listing
of the companies and ratings.) Additionally, A.M. Best has affirmed
the ICR of "bbb-" and the debt rating of "bbb-" on the $125 million of
7.875% senior unsecured notes of Americo Life, Inc. (Americo) (Kansas
City, MO).

Concurrently, A.M. Best has removed from under review and upgraded
the FSR to B+ (Good) from B (Fair) and ICR to "bbb-"from "bb" of
Investors Life Insurance Company of North America (ILNA) and has
withdrawn the ICR of "b-" of Financial Industries Corporation (FIC).
Both companies are domiciled in Austin, TX. These ratings were placed
under review with positive implications on January 16, 2008, following
the announcement that FIC had reached an agreement in principle to
merge with Americo. The merger subsequently closed on July 17, 2008.
The outlook for all ratings is stable.

The ratings reflect Americo's improved statutory profitability,
continued growth in GAAP earnings driven by strong sales of term life
insurance, favorable mortality experience, moderate financial leverage
and adequate coverage. Additionally, the consolidated capital position
of Americo's statutory entities has continued to improve, although its
risk-adjusted capitalization as measured by Best's Capital Adequacy
Ratio (BCAR) has declined due to the use of surplus notes in
conjunction with the acquisition of FIC.

Partially offsetting these positive rating factors are Americo's
substantial use of reinsurance, total statutory capital to liabilities
that is well below the industry average, an above average intangible
assets-to-equity ratio, the highly competitive conditions in AFL's
core individual life and annuity lines and its exposure to equity
market and interest rate risk from its interest-sensitive life and
annuity liabilities. Additionally, the SEC's recently proposed rule
change that would regulate fixed-indexed annuities as securities could
pressure Americo's ability to grow annuity deposits.

The upgrade of ILNA's ratings reflects the greater financial
flexibility resulting from its ownership by AFL, somewhat offset by
Americo's plans to manage ILNA's current inforce business of
individual life and annuities as run-off blocks. The withdrawal of
FIC's ICR reflects Americo's intentions to no longer utilize this
entity and to eventually separate it from ILNA's operations.

For a complete listing of Americo Life, Inc.'s FSRs, ICRs and debt
ratings, please visit http://www.ambest.com/press/090504americo.pdf.

Founded in 1899, A.M. Best Company is a global full-service credit
rating organization dedicated to serving the financial and health care
service industries, including insurance companies, banks, hospitals
and health care system providers. For more information, visit
www.ambest.com.

A.M. Best Co.
Analysts:
Jason Croft, 908-439-2200, ext. 5056
jason.croft@ambest.com
or
Thomas Rosendale, 908-439-2200, ext. 5201
thomas.rosendale@ambest.com
or
Public Relations:
Jim Peavy, 908-439-2200, ext. 5644
james.peavy@ambest.com
or
Rachelle Morrow, 908-439-2200, ext. 5378
rachelle.morrow@ambest.com

Copyright Business Wire 2008