AON Corporation's Sale of Life Insurance Company of Virginia Generates Rating Watch Uncertainty

Strategic Insights -

Duff & Phelps Credit Rating Co. has placed the 'AA+' claims paying ability rating of Life Insurance Company of Virginia (LOV) on Rating Watch -- Uncertain following AON Corporation's announcement that it has signed a definitive agreement to sell LOV to General Electric Capital Corporation (GECC) for $960 million. The rating was initially placed on Rating Watch -- Uncertain on September 27, 1995, after LOV's parent company, AON, expressed its intention to sell the subsidiary. The ultimate rating for LOV will be based on the terms of the transaction and management's strategic plans.

Key Takeaways:

  • Duff & Phelps Credit Rating Co. has kept the 'AA+' claims paying ability rating of LOV on Rating Watch -- Uncertain.
  • The rating was originally placed on Rating Watch -- Uncertain on September 27, 1995, following an announcement by LOV's parent, AON, that it was exploring the sale of LOV.
  • The claims paying ability rating of GNA subsidiaries has been rated as follows: General Electric Capital Assurance Company at 'AA-'; Great Northern Insured Annuity Corporation at 'AA'; First GNA Life Insurance Company of New York at 'AA'; Federal Home Life Insurance Company at 'AA-'; The Harvest Life Insurance Company at 'AA-'; and PHF Life Insurance Company at 'AA-'.
  • The sale of LOV is expected to result in LOV becoming a subsidiary of GNA Corporation, a Seattle-based holding company.
  • The ultimate rating for LOV will be based on the terms of the transaction and management's strategic plans.

Statistics:

  • $960 million: The sale price of LOV to General Electric Capital Corporation (GECC).
  • 12/27/95: The date of the announcement by AOC GE.
  • 15:04 EST: The time of the announcement.
  • 312-368-3158: The phone number of Julie A. Burke, CPA, CFA, at Duff & Phelps Credit Rating Co.
  • 312-368-3191: The phone number of Martha M. Butler, CFA, at Duff & Phelps Credit Rating Co.

Sources:

  • AON Corporation
  • General Electric Capital Corporation
  • Life Insurance Company of Virginia
  • Duff & Phelps Credit Rating Co.
  • GNA Corporation
  • PRNewswire