Overview -- ILA has good operating performance and implicit support from its parent, Sun Life. -- We are affirming our 'BBB+' financial strength rating on ILA and assigning our 'BBB+' counterparty credit rating. -- The stable outlook reflects our expectation that statutory operating earnings will continue to be enhanced by ILA's significantly redundant capital level. Rating Action On Jan. 11, 2013, Standard & Poor's Ratings Services affirmed its 'BBB+' financial strength rating on Independence Life & Annuity Co. (ILA) and assigned its 'BBB+' long-term counterparty credit rating. The outlook is stable. Rationale Our ratings on ILA reflect its stand-alone credit profile plus one notch of implicit support from the Sun Life group based on our application of our group methodology criteria. ILA has been in run-off since the mid-1990s and generates good operating performance, in large part because it maintains a significant surplus position. As of Sept. 30, 2012, total statutory admitted assets were $130.4 million, total liabilities were $66.7 million, and capital and surplus was $63.7 million. Year-to-date statutory net income through Sept. 30, 2012, was $1.9 million. The significantly redundant capital adequacy position is evidence of ongoing support from the Sun Life group, which, in our opinion, is committed to maintaining ILA's sound financial profile. Outlook The outlook is stable. We expect statutory operating earnings to continue to be enhanced by ILA's significantly redundant capital level. We could raise the ratings if ILA receives explicit support from a stronger affiliate. We could lower the ratings if the capital redundancy is significantly reduced or if ILA does not sustain positive earnings. Related Criteria And Research Principles Of Credit Ratings, Feb. 16, 2011 Ratings List New Rating Independence Life & Annuity Co. Counterparty Credit Rating Local Currency BBB+/Stable/-- Ratings Affirmed Independence Life & Annuity Co. Financial Strength Rating Local Currency BBB+/Stable/-- Complete ratings information is available to subscribers of RatingsDirect on the Global Credit Portal at www.globalcreditportal.com. All ratings affected by this rating action can be found on Standard & Poor's public Web site at www.standardandpoors.com. Use the Ratings search box located in the left column.