AM Best Affirms Credit Ratings of RBC Life Insurance Company

AM Best has affirmed the Financial Strength Rating (FSR) of A (Excellent) and the Long-Term Issuer Credit Rating (Long-Term ICR) of a+ of RBC Life Insurance Company (RBC Life) (Mississauga, Ontario). The outlook of these Credit Ratings (ratings) is stable.

The ratings reflect RBC Lifes balance sheet strength, which AM Best categorizes as very strong, as well as its strong operating performance, neutral business profile and appropriate enterprise risk management.

RBC Life continues to produce favorable operating results in its core life business as it looks to continue its expansion into the annuity space, all while being backed by a solid balance sheet through fiscal year-end 2018.

RBC Life operates as the Canadian life insurance operation of its ultimate parent, Royal Bank of Canada (RBC) [TSX and NYSE: RY], under RBC Insurance, a division of RBC. RBC Lifes earnings in fiscal-year 2018 reached a record high for the third consecutive year due largely to favorable investment related gains, which overshadowed some unfavorable claims experience in the companys disability insurance line of business. The company significantly has expanded premiums written in its group annuity and wealth lines of business in recent years, further diversifying its overall book of business and becoming a major player in Canadas pension risk transfer business. In addition, the companys Bests Capital Adequacy Ratio (BCAR) is strong, supported by further substantial growth in absolute capital.

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Partially offsetting these positive rating factors are the challenges RBC Life still faces while positioning itself to increase market share in Canadas competitive insurance environment, which is dominated by several larger organizations. Despite significant premium growth in RBC Lifes group annuity and wealth business, the group annuity business still is gaining traction and the wealth business has yet to achieve scale. As a result, RBC Life is still dependent on its individual life insurance business for earnings.

This press release relates to Credit Ratings that have been published on AM Bests website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Bests Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Understanding Bests Credit Ratings. For information on the proper media use of Bests Credit Ratings and AM Best press releases, please view Guide for Media – Proper Use of Bests Credit Ratings and AM Best Rating Action Press Releases.

AM Best is a global rating agency and information provider with a unique focus on the insurance industry. Visit for more information.

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Kevin Varvaro
Financial Analyst
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