OREANDA-NEWS. A.M. Best has affirmed the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Rating of “a+” of AMEX Assurance Company (AMEX Assurance) (Chicago, IL). AMEX Assurance is a wholly owned subsidiary of American Express Company (American Express) [NYSE: AXP]. The outlook of these Credit Ratings (ratings) is stable.

The ratings reflect AMEX Assurance’s strong capital position and five-year trend of operating income generated by providing insurance products to American Express card members. Offsetting these positive rating factors is AMEX Assurance’s limited business scope with the majority of its products confined primarily to American Express card members and the lack of growth in policyholders’ surplus over the past five years. This is due to all of AMEX Assurance’s prior years’ net income being returned to American Express through stockholder dividends.

AMEX Assurance’s strong capital position is reflective of its conservative investment risk profile, generally favorable reserve development and favorable operating results driven by solid profit margins. The favorable operating results reflect the company’s low cost, direct marketing strategy and its emphasis on travel-related and other ancillary insurance coverages offered primarily to American Express card members.