NEW YORK, NY - Standard & Poor's Ratings Services today said it raised its counterparty credit and financial strength ratings on Security Benefit Life Insurance Co. (SBLIC) and its affiliate, First Security Benefit Life Insurance and Annuity Co. of New York (FSBLIC-NY), to 'BB+' from 'BB'. The ratings remain on CreditWatch with positive implications.

"The upgrade reflects SBLIC's announcement that a group of investors led by Guggenheim Partners has indirectly contributed $175 million of capital to SBLIC," said Standard & Poor's credit analyst Adrian Pask. "This contribution follows a Feb. 16 announcement that Guggenheim entered into a definitive agreement to purchase Security Benefit Corp., SBLIC's parent company."

Although the terms of the transaction were not disclosed, Standard & Poor's believes that this transaction will ultimately remedy a capital deficiency at SBLIC and give Security Benefit Corp. access to additional financial resources through Guggenheim. Limited capital constrained SBLIC's sales in 2009. But, in 2010, we expect that SBLIC, with fresh capital, will be able to execute on its growth strategy in core 403(b) markets, a traditional stronghold of the company.

Although Guggenheim has not traditionally been an owner of life insurance companies, it does have a strong record managing general account assets for SBLIC and other life insurance companies, most notably Horace Mann and Sammons. We view Guggenheim's involvement with Security Benefit Corp. as positive. In addition to its asset management expertise, Guggenheim brings possible access to private capital and potential synergies between the asset management businesses.

(Source: Standard & Poor's Ratings Services)
 

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