Sun Life Financial Update – A strong, well-capitalized company

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2008 was a challenging year for all Canadians and Canadian businesses, and like most financial institutions, we were not immune to those challenges. As our 2008 financial results showed, Sun Life Financial experienced significantly lower than usual results in 2008 due to the global economic turbulence. Earnings for the full year were $785 million, compared to $2.2 billion for the previous full year. That said, the company’s investment portfolio remains at over C$107 billion and Sun Life Financial has C$388.7 billion of assets under management. We are exceptionally well capitalized and our well-diversified portfolio is one of our greatest strengths, especially during these turbulent times.

Moody’s, Standard & Poor’s and A.M. Best, three ratings agencies that judge the ability of Sun Life to pay claims, recently announced changes to our ratings:

  • Standard & Poor’s, announced on March 6, 2009 that it had lowered Sun Life’s financial strength rating from AA+ (Very Strong) to AA (Very Strong), which is the third of S&P’s 20 rating levels.
  • On February 27, 2009, A.M. Best announced it had downgraded Sun Life’s financial strength rating from AA+ (Superior) to A+ (Superior), which is the second of A.M. Best’s 16 rating levels. A.M. Best assigns the Superior category for “companies that have a superior ability to meet their ongoing insurance obligations.
  • Moody’s announced on February 12th that it had lowered Sun Life’s rating from Aa2 to Aa3. After the downgrade, Sun Life remains in the “Aa” category, which continues to translate as an Excellent rating. Aa3 is the fourth of 21 rating levels and is very highly regarded.

All of these agencies continue to place Sun Life Financial’s operating companies among the highest-rated insurance companies in North America. Sun Life Financial has established a record of financial strength that few organizations can match. Several life insurance carriers in the past few months have been downgraded or placed under review for possible downgrade. In the case of Moody’s, for example, they recently changed their outlook for the entire life insurance industry to negative because of current market conditions.

 

As regulated entities, Sun Life Financial’s insurance companies are required to set aside capital to offset future liabilities, and we currently maintain capital well in excess of those minimum levels required by regulators. To read more about our financial strength, please refer to the information on our on sunlife.ca website > The strength of Sun Life Financial.

 

The current economic environment is nothing less than extraordinary, and companies in every industry are facing challenging times. However, our customers and advisors can be assured that we remain a strong, well-capitalized company, and our robust balance sheet and prudent approach to capital and risk management will enable us to meet our obligations to our customers. Furthermore, we are well positioned to take advantage of market opportunities in the months ahead.

We thank you for your continued support and confidence in us.

 

Questions?

Please contact your Sun Life Financial group representative.