A.M. Best Affirms Ratings of Medco Containment Company and Medco Containment Insurance Company of Ne

A.M. Best Affirms Ratings of Medco Containment Company and Medco Containment Insurance Company of New York

OLDWICK, N.J.--(BUSINESS WIRE)-- A.M. Best Co. has affirmed the financial strength rating of A- (Excellent) and issuer credit ratings of "a-" of Medco Containment Life Insurance Company (MCLIC) (headquartered in Franklin Lakes, NJ) and Medco Containment Insurance Company of New York (MCICNY) (Clifton Park, NY). The outlook for all ratings is stable.

The ratings are based on MCLIC and MCICNY's continued favorable operating results, strong capitalization at both entities and the strategic importance of their ultimate parent company, Express Scripts Holding Company (Express Scripts) [NASDAQ: ESRX]. During 2012, these companies were acquired by Express Scripts, and the newly merged organization is the largest pharmacy benefit manager in the United States. Each respective company's underwriting results have been trending favorably over the medium term driven by margin improvement. Capital levels at the companies are more than adequate for their current level of business. Near-term capital growth levels are mainly the result of strong net earnings and lack of dividends paid. A.M. Best expects capital support will be provided by Express Scripts, when necessary.


MCLIC and MCICNY offer very limited product portfolios, which primarily consist of Medicare Part D business offered to Express Scripts' clients and individuals. All long-term revenues are expected to be derived from Medicare Part D products. This narrow focus on Medicare poses a market concentration risk. A.M. Best expects that MCLIC and MCICNY will focus their business in support of Express Scripts' clients.

Factors that may positively affect the ratings include a change in product diversity and sustained long-term earnings. Key rating drivers that could lead to negative rating actions include a trend of losses, capital deteriorating beyond A.M. Best's expectations or the Medco companies becoming less strategically important to Express Scripts.

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.

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

Copyright © 2013 by A.M. Best Company, Inc.ALL RIGHTS RESERVED.



A.M. Best Company
Wayne Kaminski, 908-439-2200, ext. 5061
Senior Financial Analyst
wayne.kaminski@ambest.com
or
Rachelle Morrow, 908-439-2200, ext. 5378
Senior Manager, Public Relations
rachelle.morrow@ambest.com
or
Jeffrey Lane, 908-439-2200, ext. 5567
Managing Senior Financial Analyst
jeffrey.lane@ambest.com
or
Jim Peavy, 908-439-2200, ext. 5644
Assistant Vice President, Public Relations
james.peavy@ambest.com

KEYWORDS:   United States  Europe  North America  New Jersey

INDUSTRY KEYWORDS:

The article A.M. Best Affirms Ratings of Medco Containment Company and Medco Containment Insurance Company of New York originally appeared on Fool.com.

Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Read Full Story

Can't get enough business news?

Sign up for Finance Report by AOL and get everything from retailer news to the latest IPOs delivered directly to your inbox daily!

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.