AM Best affirmed the financial strength rating of A++ (Superior) and the issuer’s long-term credit rating (long-term ICR) of “aa+” (Superior) from
The ratings reflect Thrivent’s balance sheet strength, which AM Best rates as the strongest, as well as its strong operating performance, favorable business profile and very strong enterprise risk management (ERM).
The ratings recognize Thrivent’s favorable persistence through its loyal member base and its efforts to continue to grow despite the difficult economic environment. Thrivent maintains a diverse and well-managed product portfolio that aims to complement the needs of its customers throughout their lifecycle. The company continues to diversify its portfolio to meet the needs of its customers. In 2022, Thrivent added a Whole Life/LTC hybrid product to complete its diversification and plans new products in the future. Thrivent’s reserves are weighted toward ordinary life, which AM Best considers a more solvent liability profile.
In 2021, Thrivent recorded record investment income at just over
unrealized losses due to market movements. The company strengthened its liquidity at the end of 2021, adding borrowing capacity to the
Offsetting rating factors include historical losses within its former long-term care block, which comprises a small portion of its portfolio. However, Thrivent’s long-term care (LTC) business, which consists of a legacy block in liquidation and a new LTC block, recorded an operating gain in 2021, due to reserve releases. and favorable COVID-related experience over the past two years at its closed site. block of old SLD contracts. Additionally, Thrivent maintains a slightly elevated level of Schedule BA assets, which it has managed well during the pandemic. Additionally, Thrivent has a high percentage of interest rate sensitive reserves and an above average percentage of annuities with no surrender charge protection. This exposes Thrivent to spread compression and given rapidly rising interest rates, it presents a risk of disintermediation within its annuity bloc.
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Source: AM Best