Market Overview

A.M. Best Affirms Credit Ratings of Great-West Lifeco Inc. and Its Subsidiaries; Upgrades Credit Ratings of Reinsurance Entities


A.M. Best has affirmed the Financial Strength Rating of A+
(Superior) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of
"aa" of The Great-West Life Assurance Company (Winnipeg,
Manitoba) and its affiliates, London Life Insurance Company
(London, Ontario), The Canada Life Assurance Company (CLAC)
(Toronto, Ontario), Great-West Life & Annuity Insurance Company
(GWL&A) (Greenwood Village, CO) and Great-West Life & Annuity
Insurance Company of New York
(New York, NY). Concurrently, A.M.
Best has affirmed the Long-Term ICR of "a" and the Long-Term Issue
Credit Ratings (Long-Term IR) of Great-West Lifeco, Inc. (Lifeco)
(Winnipeg, Manitoba). (See below for a detailed listing of the Long-Term

Additionally, A.M. Best has upgraded the FSR to A+ (Superior) from A
(Excellent) and the Long-Term ICR to "aa" from "a+" of London Life
Reinsurance Company
(Blue Bell. PA), Canada Life International Re
Designated Activity Company
(Ireland) and London Life and
Casualty (Barbados) Corporation
(Barbados) (collectively
known as the reinsurance entities). The rating upgrades reflect
A.M. Best's view of the increased strategic importance of the
reinsurance entities to Lifeco's current and future operations, as they
contribute a more significant portion of the company's overall earnings.

The outlook of these Credit Ratings (ratings) is stable.

The ratings of Lifeco's operating companies reflect their strongest
balance sheet strength, as well as their strong operating performance,
very favorable business profile and appropriate enterprise risk

The rating affirmations also reflect the group's highly diversified
earnings profile by product and geography, strong market position in its
core business lines and solid regulatory capital levels. Lifeco
maintains diversified insurance, reinsurance and financial services
operations, along with its appropriate enterprise risk management
capabilities. The organization has consistently generated significant
cash flows from operations and has demonstrated its ability to manage
financial leverage and interest coverage within A.M. Best's expectations
for its current ratings. In addition, Lifeco maintains an excellent
liquidity posture supported by high-quality investments and credit

Moreover, A.M. Best recognizes Lifeco's consolidated position as a
market leader in Canada's individual and group insurance lines, with
superior market positions in the wealth accumulation and protection
segments. The Canadian distribution systems of Lifeco and its operating
companies represent the largest in Canada and serve as a significant
competitive advantage, while its conservative pricing discipline and
scale enables it to generate favorable operating results. The U.S.
operation has continued to produce stable earnings contributions, and
has grown organically and through strategic acquisitions. The European
business segments, which also have grown significantly through
acquisitions, provide further diversification.

The ratings also reflect the challenges and risks associated with the
current low interest rate environment. Also noted is Lifeco's large
amount of goodwill and intangibles due to strategic acquisitions. In
addition, A.M. Best expects that the group will continue to face
challenges associated with growth in its core U.S. business segments due
to the highly competitive environment.

The following Long-Term IRs have been affirmed with a stable outlook:

Great-West Lifeco, Inc.—
-- "a" on CAD 500 million 4.65%
senior unsecured debentures, due 2020
-- "a" on EUR 500 million
2.50% senior unsecured euro bonds, due 2023
-- "a" on EUR 500
million 1.75% senior unsecured euro bonds, due 2026
-- "a" on CAD
500 million 3.337% senior unsecured debentures, due 2028
-- "a" on
CAD 200 million 6.74% senior unsecured debentures, due 2031
-- "a"
on CAD 400 million 6.67% senior unsecured debentures, due 2033
"a" on CAD 343.788 million 5.998% senior unsecured debentures, due 2039
"bbb+" on CAD 200 million 4.80% non-cumulative first preferred shares
"bbb+" on CAD 200 million 5.15% non-cumulative first preferred shares
"bbb+" on CAD 200 million 5.15% non-cumulative first preferred shares
"bbb+" on CAD 250 million 5.40% non-cumulative first preferred shares
"bbb+" on CAD 170 million 5.65% non-cumulative first preferred shares
"bbb+" on CAD 150 million 5.80% non-cumulative first preferred shares
"bbb+" on CAD 200 million 5.90% non-cumulative preferred shares (of
which $194 million remains outstanding)
-- "bbb+" on CAD 213
million 2.18% non-cumulative rate reset preferred shares
-- "bbb+"
on CAD 37 million floating rate non-cumulative preferred shares
"bbb+" on CAD 300 million 5.20% non-cumulative preferred shares
"bbb+" on CAD 300 million 4.50% non-cumulative preferred shares
"bbb+" on CAD 300 million 4.85% non-cumulative preferred shares
"bbb+" on CAD 200 million 5.25% non-cumulative preferred shares

Great-West Lifeco Finance (Delaware) LP—
-- "a" on USD 700
million 4.15% senior unsecured debentures, due 2047

Great-West Lifeco Finance 2018—
-- "a" on USD 300 million
4.047% senior unsecured notes, due 2028
-- "a" on USD 500 million
4.581% senior unsecured notes, due 2048

Great-West Life & Annuity Insurance Capital, LP—
"bbb+" on USD 175 million 6.625% junior subordinated deferrable
debentures, due 2034

The Canada Life Assurance Company—
-- "a+" on CAD 100
million 6.40% subordinated debentures, due 2028

Canada Life Capital Trust—
-- "a" on CAD 150 million 7.529%
non-cumulative Canada Life Capital Securities (CLiCS), due 2052

The following indicative Long-Term IRs on securities available under
shelf registration have been affirmed with a stable outlook:

Great-West Lifeco, Inc.—
-- "a" on senior unsecured debt
"a-" on subordinated debt
-- "bbb+" on junior subordinated debt
"bbb+" on preferred shares

This press release relates to Credit Ratings 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 see A.M. Best's
Rating Activity
web page. For additional information
regarding the use and limitations of Credit Rating opinions, please view
Best's Credit Ratings
. For information on the proper media
use of Best's Credit Ratings and A.M. Best press releases, please view
for Media - Proper Use of Best's Credit Ratings and A.M. Best Rating
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