Company Website: http://www.ambest.com
OLDWICK, N.J. -- (Business Wire)

A.M. Best has assigned a debt rating of “a” to the recently issued CAD 250 million 2.64% subordinated debentures due Feb. 23, 2027 of Industrial Alliance Insurance and Financial Services Inc. (IA) (Quebec City, Quebec) (TSX:IAG). The outlook assigned is stable, which is consistent with the outlook for the existing ratings of IA and its core operating insurance subsidiaries. (For further details, please see A.M. Best’s press release dated Feb. 13, 2015.)

The proceeds from the debt offering will be added to IA’s capital base and be utilized for general corporate purposes, including the redemption of IA’s outstanding CAD 100 million 5.90% Non-Cumulative Class A Preferred Shares Series F. IA intends to redeem the preferred shares on March 31, 2015. A.M. Best notes that IA’s overall financial leverage is expected to remain below 30%, while interest coverage is expected to remain above five times. Both measures are within A.M. Best’s guidelines for IA’s current rating level.

The rating recognizes IA’s solid absolute and risk-adjusted capitalizations, consistent profitability, product diversification and growth in assets under management. At year-end 2014, IA reported solid operating earnings, while maintaining adequate risk-adjusted capital ratios. Premium growth for the year was led by strong individual insurance sales. Additionally, the company saw improvement in their segregated funds business. A.M. Best will continue to monitor the impact of the current macroeconomic environment, including interest rate movements on IA’s earnings and risk-adjusted capital.

The methodology used in determining these ratings is Best’s Credit Rating Methodology, which provides a comprehensive explanation of A.M. Best’s rating process and contains the different rating criteria employed in the rating process. Best’s Credit Rating Methodology can be found at www.ambest.com/ratings/methodology.

Key insurance criteria reports utilized:

• Equity Credit for Hybrid Securities

• Insurance Holding Company and Debt Ratings

This press release relates to rating(s) that have been published on A.M. 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 visit A.M. Best’s Ratings & Criteria Center.

A.M. Best Company is the world's oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com.

Copyright © 2015 by A.M. Best Company, Inc.ALL RIGHTS RESERVED.

Contacts:

A.M. Best Company, Inc.
Edward Kohlberg,908-439-2200, ext. 5664
Senior Financial Analyst
edward.kohlberg@ambest.com
or
Thomas Rosendale, 908-439-2200, ext. 5201
Assistant Vice President
thomas.rosendale@ambest.com
or
Christopher Sharkey, 908-439-2200, ext. 5159
Manager, Public Relations
christopher.sharkey@ambest.com
or
Jim Peavy, 908-439-2200, ext. 5644
Assistant Vice President, Public Relations
james.peavy@ambest.com

Source: A.M. Best Company, Inc.