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Credit ratings

AM Best Affirms RBC Life Insurance Company's Financial Strength Rating

Strategic Insights

— 1 min read

RBC Life Insurance Company, a subsidiary of Royal Bank of Canada, has maintained its Financial Strength Rating of A (Excellent) and Long-Term Issuer Credit Rating of "a+" (Excellent) from AM Best, a global credit rating agency. This rating reflects the company's strong balance sheet, stable operating performance, and appropriate enterprise risk management. RBC Life has successfully transitioned to IFRS 17 reporting and reported CAD 340 million in earnings in 2024. The company's premiums written increased by 4% in the medium term, and its overall operating performance metrics have shown a favorable trend.

Key Takeaways:

  • RBC Life Insurance Company maintains a Financial Strength Rating of A (Excellent) and Long-Term Issuer Credit Rating of "a+" (Excellent) from AM Best, with a stable outlook.
  • The company's balance sheet is assessed as very strong, with a stable mix of business over the last five years.
  • RBC Life has successfully transitioned to IFRS 17 reporting in 2023 and reported approximately CAD 340 million of earnings in 2024.
  • The company's overall level of premiums written increased by 4% in the medium term, with a favorable trend in overall operating performance metrics.
  • RBC Life is owned ultimately by Royal Bank of Canada, the largest bank in Canada, with approximately CAD 127 billion of IFRS equity at financial year-end 2024 and over CAD 2 trillion in assets.
  • The parent bank earned approximately CAD 16 billion in net income on CAD 57 billion in revenue in fiscal-year 2024.
  • AM Best notes that RBC does not guarantee support, but may provide additional capital at its discretion should RBC Life need to maintain its risk-adjusted capitalization levels.

Statistics:

  • Financial Strength Rating: A (Excellent)
  • Long-Term Issuer Credit Rating: "a+" (Excellent)
  • Balance sheet strength: Very strong
  • Earnings in 2024: CAD 340 million
  • Premiums written: 4% increase in the medium term
  • Total IFRS equity at Royal Bank of Canada: Approximately CAD 127 billion
  • Total assets at Royal Bank of Canada: Over CAD 2 trillion
  • Net income at Royal Bank of Canada: Approximately CAD 16 billion
  • Revenue at Royal Bank of Canada: CAD 57 billion in fiscal-year 2024

Sources:

  • AM Best press release
  • Businesswire.com
  • Guide to Best's Credit Ratings
  • Guide to Proper Use of Best's Ratings & Assessments
  • AM Best Recent Rating Activity web page
  • Royal Bank of Canada's annual report (2024)

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