...And the results are in. Ward Group today announced the results of its 20th annual analysis of the top financial performance among nearly 800 U.S.-based life and health carriers. The 2010 Ward’s 50 life/health group of insurance companies (listed below) produced a 16.1% return on average equity from 2005 to 2009 compared to 3.7% for the life-health industry overall.

“Most companies now understand the current economic situation and its impact on their business,” says Jeff Rieder, president of Ward Group. “However, the scars from the last two years are still affecting business decisions. It is important for companies to maintain a long-term vision throughout difficult business cycles. In selecting the Ward’s 50, we identify companies that pass financial stability requirements and measure their ability to grow while maintaining strong capital positions and underwriting results.”

Each Ward's 50 company has passed all safety and consistency screens, and achieved superior performance over the five years analyzed.

 

Safety and Consistency Tests

Insurance companies are evaluated and must pass minimum thresholds to be considered for the Ward’s 50 designation. Each company must pass the following primary safety and consistency tests:

• Surplus and premiums of at least $50 million for each of the five years analyzed

• Net income in at least four of the last five years

• Risk-based capital ratio of at least 100% for each of the five years analyzed

• Compound annual growth in premiums between -10% and +40%

 

Key Performance Benchmarks

The firm says an important objective of Ward’s 50 is to compare their performance as a group with the rest of the industry. In addition to achieving greater levels of income returns, the Ward’s 50 benchmarks also outperformed in other key performance benchmarks.

The Ward’s 50 life/health group outpaced the industry for five-year policyholder surplus growth (8.4% compared to 5.6%) and premium income growth (12.4% compared to 1.3%).  

A recurring theme with the Ward’s 50 companies, Ward says, is achieving greater levels of efficiency compared to peer companies.

“Although we do not directly use expenses as a factor in the Ward’s 50 evaluation, a common attribute of the top performing segment is the ability to operate at lower expense ratios,” Rieder says. In 2009, expenses relative to revenue were 16.8% lower for the Ward’s 50 life/health group. “Our research consistently finds the top companies achieve a proper balance between managing expenses and making prudent investments in systems or processes to meet customer needs and corporate goals,” he continues.

 

Ward's 2010 50 Life/Health Insurers (listed alphabetically)

Aetna Life Insurance Company

AFLAC

American Family Life Insurance Company

American Fidelity Assurance Company

American Republic Insurance Company

Amica Life Insurance Company

Auto-Owners Life Insurance Company

Baltimore Life Insurance Company

Berkshire Life Insurance Company of America

Centurion Life Insurance Company

CIGNA Group

Combined Insurance Company of America

Farm Bureau Life Insurance Company of MI

Federated Life Insurance Company

Fidelity Investments Life Insurance Company

Fidelity Security Life Insurance Company

First Investors Life Insurance Company

Forethought Life Insurance Company

General Re Life Insurance Corporation

Great American Life Insurance Company

Health Net Life Insurance Company

HM Life Insurance Company

Homesteaders Life Company

Household Life Insurance Company

Humana Insurance Company

Liberty National Life Insurance Company

Metropolitan Life Insurance Company

National Guardian Life Insurance Company

National Life Insurance Company

National Western Life Insurance Company

New York Life Insurance Company

Oxford Life Insurance Company

Ozark National Life Insurance Company

Pacific Guardian Life Insurance Company

Physicians Mutual Insurance Company

Primerica Life Insurance Company

Reliance Standard Life Insurance Company

Shelter Life Insurance Company

Southern Farm Bureau Life Insurance Co.

Standard Insurance Company

Symetra Life Insurance Company

Tennessee Farmers Life Insurance Company

Thrivent Financial for Lutherans

Trustmark Insurance Company

United Healthcare Insurance Company

United Life Insurance Company

USAA Life Insurance Company

USAble Life Insurance Company

WellPoint Group

Western & Southern Life Insurance Company

 

To see Ward Group's list of the Top 50 P&C Insurers, click here.

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