AM Best has upgraded the Financial Strength Rating (FSR)
to A+ (Superior) from A (Excellent) and the Long-Term Issuer Credit
Rating (Long-Term ICR) to “aa-” (Superior) from “a+” (Excellent)
for the majority of the health and dental insurance subsidiaries of
UnitedHealth Group, collectively referred to as UnitedHealthcare.
AM Best also has upgraded the Long-Term ICR to “a” (Excellent) from
“a-” (Excellent) and its associated Long-Term Issue Credit Ratings
and Short-Term Issue Credit Rating (Long-Term IR’s, Short-Term IR)
of UnitedHealth Group Incorporated (UnitedHealth Group)
(Minnetonka, MN) [NYSE: UNH]. The outlook of these Credit Ratings
(ratings) has been revised to stable from positive.
Concurrently, AM Best has upgraded the FSR to A+ (Superior) from
A (Excellent) and the Long-Term ICRs to “aa-” (Superior) from “a”
(Excellent) of Freedom Life Insurance Company of America,
Enterprise Life Insurance Company and National Foundation Life
Insurance Company, which are now collectively referred to as
UnitedHealthcare. These companies are domiciled in Fort Worth, TX.
In addition, AM Best has affirmed the FSR of A (Excellent) and the
Long-Term ICR of “a” (Excellent) of The Chesapeake Life Insurance
Company (Chesapeake Life) (Oklahoma City, OK). The outlook of these
ratings is stable. (See link below for a detailed listing of the
companies and ratings.)
The ratings reflect UnitedHealthcare’s balance sheet strength,
which AM Best assesses as strong, as well as its very strong
operating performance, very favorable business profile and very
strong enterprise risk management (ERM).
The rating upgrades for UnitedHealthcare reflect robust
profitability metrics, supported by premium growth, very strong
earnings and strategic capital management. UnitedHealthcare has
experienced significant premium development driven by growth across
multiple business segments but with a more pronounced growth in
government programs. Underwriting gains have been consistently
outperforming, setting a new record high over the past three years
reflecting solid underwriting practices, growing vertical
integration, value-based arrangements and technology innovations
leading to care efficiencies and more advanced medical
management.
In addition, expanding membership and premium enhance the
economies of scale and provide foundation for diligent
administrative expense control. The ability to control cost
positions the organization for further profitable growth in all
segments, especially in government programs in which margins are
lower and competition remains very intense. Stability and growth in
earnings have left UnitedHealthcare well-positioned to navigate the
uncertainties of the COVID-19 pandemic. While the impacts of the
pandemic have altered operating results in 2020, over the past nine
months utilization has reverted to more normal levels, albeit with
fluctuations and some depression in actual claims volume during
certain periods. This has been reflected in profitability metrics,
which remain stable to improving. The 2020 five-year statutory
return-on-equity was nearly 35%, while return-on-revenue reached
5.1% in 2020, trending higher than its peers. UnitedHealthcare
reported solid statutory net income results outperforming
historical trends, by setting new record high net income each of
the past five years, reporting $8.4 billion in 2020.
Balance sheet strength remains strong based on favorable
operating results and strategic capital management. Risk-adjusted
capital has strengthened over the past three years as earnings
growth has led to higher capital and surplus levels while still
paying sizeable dividends to the parent. This shows the company’s
ability in managing its statutory capital by ensuring capital and
liquidity is maintained at appropriate levels across its entities.
Investments policy is conservative, and investments are comprised
of primarily high quality fixed income securities with minimal to
no exposure to below investment grade or equity investments.
Liquidity measures remain solid and provide flexibility to adjust
asset allocation. High liquidity is supported by consistent, strong
operating cash flows, with supplemental support from credit
facilities with the parent company.
UnitedHealthcare’s business profile is very favorable as its
strong earnings are well-diversified by geography and by business
segment. The company has a nationwide presence with a prominent
share in most market segments. While the company has an increased
and continuously growing amount of business derived from government
programs, this balances well against the dependence on commercial
business, which is susceptible to economic pressures. Furthermore,
the company’s strategic partnerships with AARP and its affiliate,
Optum, Inc. (Optum), enhance product offerings and its health care
service capabilities, as well as for client retention.
UnitedHealth Group has a very mature and high-functioning ERM
program. The company performs advanced stress and scenario testing,
solvency assessment and economic capital modeling. The program is
embedded within the company and is utilized in operational
management of its business, strategic planning and in its response
to the COVID-19 pandemic.
Strong top line growth and consistently favorable operating
earnings from both the health insurance entities at
UnitedHealthcare and from its nonregulated business, Optum, have
provided UnitedHealth Group with continued solid financial
flexibility. The non-regulated business from Optum, which comprises
approximately half of UnitedHealth Group’s consolidated earnings,
has experienced margin expansion and double-digit growth
year-over-year, for each of the past three years. It also provided
UnitedHealth Group with slightly more than half of its cash flow
during 2021, a trend that is likely to increase as the business
continues to grow. UnitedHealth Group has a high level of financial
flexibility with material nonregulated cash flow, high dividend
capacity from its health insurance subsidiaries and a $12.5 billion
credit facility.
UnitedHealth Group has managed its financial leverage in the 40%
range over the long-term experiencing temporary fluctuations
following sizeable acquisitions. This might reoccur once the
previously announced acquisition of Change Healthcare is completed,
which could temporarily increase the measure to above 40%. However,
AM Best anticipates the company will deploy deleveraging actions to
revert to its 40% range, as it has demonstrated in the past. This
transaction has been delayed, but is expected to close in the first
half of 2022.
The percentage of goodwill and intangible assets to equity has
been declining, mainly due to equity growth, and was at 117% at
Sept. 30, 2021. Although this metric is higher than some of its
peers, the company has no history of material write-downs and the
company tests its goodwill annually. UnitedHealth Group’s earnings
before interest and taxes (EBIT) interest coverage are strong at
over 13 times for full-year 2020 based on its strong operating
earnings.
The ratings reflect Chesapeake Life’s balance sheet strength,
which AM Best assesses as very strong, as well as its adequate
operating performance, limited business profile and appropriate
ERM.
A complete listing of UnitedHealth Group’s health and dental
insurance subsidiaries’ FSRs, Long-Term ICRs and Short- and
Long-Term IRs also is available.
This press release relates to Credit Ratings that have been
published on AM Best’s 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 Best’s Recent Rating
Activity web page. For additional information regarding the use and
limitations of Credit Rating opinions, please view Guide to Best's
Credit Ratings. For information on the proper use of Best’s Credit
Ratings, Best’s Preliminary Credit Assessments and AM Best press
releases, please view Guide to Proper Use of Best’s Ratings &
Assessments.
AM Best is a global credit rating agency, news publisher and
data analytics provider specializing in the insurance industry.
Headquartered in the United States, the company does business in
over 100 countries with regional offices in London, Amsterdam,
Dubai, Hong Kong, Singapore and Mexico City. For more information,
visit www.ambest.com.
Copyright © 2021 by A.M. Best Rating
Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.
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version on businesswire.com: https://www.businesswire.com/news/home/20211209005714/en/
Antonietta Iachetta Senior Financial Analyst +1 908 439 2200,
ext. 5792 antonietta.iachetta@ambest.com Doniella Pliss
Director +1 908 439 2200, ext. 5104 doniella.pliss@ambest.com
Christopher Sharkey Manager, Public Relations +1 908 439 2200,
ext. 5159 christopher.sharkey@ambest.com Jim Peavy Director,
Communications +1 908 439 2200, ext. 5644
james.peavy@ambest.com
UnitedHealth (NYSE:UNH)
過去 株価チャート
から 3 2024 まで 4 2024
UnitedHealth (NYSE:UNH)
過去 株価チャート
から 4 2023 まで 4 2024