A.M. Best Places Rating of Transamerica Life Canada Under Review

Business Wire, Dec 13, 2002

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Business Editors

OLDWICK, N.J.--(BUSINESS WIRE)--Dec. 13, 2002

A.M. Best Co. has placed the financial strength rating of A (Superior) of Transamerica Life Canada (Scarborough, Ontario) under review with negative implications.

This rating action reflects the challenges facing Transamerica from increasing competition in the Canadian life marketplace and weakened earnings performance in 2002.

The competitive landscape in Canada has changed significantly in recent years and is increasingly dominated by large organizations with diversified sources of earnings and significant scale advantages. A.M. Best believes Transamerica's future operating results may be impacted by the rapidly consolidating Canadian life insurance market, which may lead to heightened sales, pricing and earnings pressures in an already highly competitive marketplace. Additionally, Transamerica is highly dependent on fee income from its segregated funds, which have experienced recent volatility.

The rating will remain under review while A.M. Best meets with Transamerica's senior management team to review its financial, strategic and operational plans.

A.M. Best Co., established in 1899, is the world's oldest and most authoritative insurance rating and information source. For more information, visit A.M. Best's Web site at www.ambest.com .