A.M. Best Co. has affirmed its A-plus rating for the life insurance units of Axa Financial Inc., the U.S. arm of Paris-based Axa Group.
The grade reflects the consistent earnings generated by Axa Financial's large blocks of ordinary life and variable annuity business, both of which have benefited from diligent expense management, the Oldwick, N.J., ratings agency said on Friday.
The ratings also reflect the earnings and strategic benefits accruing to Axa Financial from its majority ownership stake in the money management company Alliance Capital, which remains a steady source of income, the ratings agency said. Axa Financial's broad distribution footprint lets the company continue to expand its substantial share of the affluent and mass -affluent segments of the retail protection and savings markets, according to Best.
Risks to the company include volatile equity markets, competitive pressures, and low interest rates, it said. Expenses related to the purchase of Mony Group have affected the company's recent earnings. However, Best said, it expects Axa Financial's operating fundamentals to improve in the near to medium term.
