Financial Information

Financial Strength

Throughout our history, Beneficial has been known for its financial strength. Beneficial historically has made protecting families through economic hardships a top priority. During the stock market crash of 1929 and the economic depression of the 1930s, Beneficial honored policy owner requests for policy loans and surrender payments, although deferring such cash payments was allowed by law. Likewise, through both World Wars, we paid death claims for insureds who died while serving their country, without invoking policy war clauses that allowed denial of such claims.

2016 Year End Financial Highlights

As of December 31, 2016, Beneficial's insurance in-force was $14.6 billion. Other highlights include the following amounts, based on statutory accounting practices followed by insurance companies:

Category
Amount in thousands
Total admitted assets
2,298,442
Policy reserves and other liabilities
2,121,079
Capital and surplus
177,363

Capital and Surplus

Beneficial continues to maintain very high capital and surplus as a financial safety cushion to meet the company's future liability obligations. As of December 31, 2016, the company's capital and surplus was $177.4 million.

2016 Year End Asset and Investment Highlights

As of December 31, 2016, Beneficial's assets and asset allocation were as follows:

ASSETS

AMOUNT
in thousands

ASSET ALLOCATION
percent of total

Bonds
$1,946,197
84.7%
Stocks
130,135
5.7%
Policy loans
96,537
4.2%
Cash and short-term investments
46,432
2.0%
Other invested assets
21,133
0.9%
Other assets
58,008
2.5%
Total assets
2,298,442
100.0%

2016 Year End Bond Quality

Beneficial's diversified bond portfolio consists of approximately 640 separate issues. As of December 31, 2016, the quality of Beneficial's bond portfolio was divided into the following risk categories as classified by the National Association of Insurance Commissioners (NAIC). NAIC's six categories are based on the level of risk, ranging from 1 to 6; level 1 is the highest quality and lowest risk.


NAIC Risk Category

Percent of Total

1 (investment grade)
71
2 (investment grade)
26
3-6 (non-investment grade)
3
Total
100

Risk-based Capital Ratio

Beneficial's risk-based capital ratio as of December 31, 2016, was 1,090%.

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