S&P upgrades Athene ratings
Athene Holding has revealed that Athene Life Insurance Company of New York (ALICNY) and First Allmerica Financial Life Insurance Company (FAFLIC), a subsidiary of Global Atlantic Financial Group, have agreed to a consent order with the New York State Department of Financial Services (NYSDFS).
The agreement resolves a previously disclosed examination of ALICNY by the NYSDFS relating to a group of life policies reinsured to and administered by FAFLIC and its sub-contractor, DXC Technology (DXC).
The company said that in connection with the acquisition of Aviva USA in 2013, Athene reinsured a block of life policies to FAFLIC and its affiliates. The administration issues identified by the NYSDFS in the consent order resulted from the conversion by FAFLIC and DXC of these policies from legacy Aviva systems to DXC’s systems. Under the terms of the agreements, FAFLIC has financial responsibility for the block and is subject to administrative service requirements required by applicable law. The agreements also provide for indemnification to Athene, including for administration issues.
As part of the resolution of the matter, the parties agreed to a remediation plan with a value of up to $40 million to resolve issues experienced by affected policyholders. The consent order also provides for a $15 million civil penalty. Under the terms of the agreements between FAFLIC and Athene, FAFLIC bears financial responsibility for the settlement.
According to Athene, the activity in the consent order does not involve its new business, which is issued and administered by a separate New York entity, administration system and procedures. Athene stated that it has a strong commitment and track record of providing high quality service to its policyholders and will continue to work with FAFLIC as the remediation matters are implemented.
Athene, NYSDFS, New York State Department of Financial Services, Athene Life Insurance, First Allmerica Financial Life Insurance