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S&P Affirms Auto Club Life Ins Co 'BBBpi' Rating

15 October 1999

S&P Affirms Auto Club Life Ins Co 'BBBpi' Rating

    NEW YORK, Oct. 15-- Standard & Poor's affirmed its triple-'Bpi' financial strength rating on Auto Club Life
Insurance Co.
    Auto Club Life Insurance Co. is a wholly owned subsidiary of Auto Club
Insurance Assoc. (financial strength rating single-'Api') and Auto Club of
Michigan Insurance Group, a large insurance group affiliated with AAA Michigan
and AAA Wisconsin, Inc.  Both are members of the American Automobile
Association, a leading automotive and travel service provider.  Auto Club Life
Insurance Co. writes individual life and annuity products, credit life, group
accident and health, individual accident, and health and group life.  The
company, headquartered in Dearborn, Mich., is licensed in 26 states.  It
commenced operations in 1974.

    Major Rating Factors:
    -- The company's rating benefits from its access to the capital and
financial flexibility that is offered by its parent, Auto Club Insurance
Assoc.

    -- Geographic and product line concentration can expose a company to
regulatory and competitive risk.

    -- Liquidity is weak at 94%, as measured by Standard and Poor's
liquidity model. Investments in medium-to-low grade bonds represent 26% of
total adjusted capital.

    -- Capitalization very strong at 168%, as measured by Standard and
Poor's capital adequacy model.

    -- Operating performance is extremely strong at 227%, as measured by
Standard and Poor's earnings adequacy model.

    'Pi' ratings, denoted with a 'pi' subscript, are insurer financial
strength ratings based on an analysis of an insurer's published financial
information and additional information in the public domain.  They do not
reflect in-depth meetings with an insurer's management and are therefore based
on less comprehensive information than ratings without a 'pi' subscript.  'Pi'
ratings are reviewed annually based on a new year's financial statements, but
may be reviewed on an interim basis if a major event that may affect the
insurer's financial security occurs. Ratings with a 'pi' subscript are not
subject to potential CreditWatch listings.
    Ratings with a 'pi' subscript generally are not modified with 'plus' or
'minus' designations.  However, such designations may be assigned when the
insurer's financial strength rating is constrained by sovereign risk or the
credit quality of a parent company or affiliated group, Standard & Poor's
said. -- CreditWire