Press Release|Insurance
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KBRA Affirms Rating for GCU

23 Jan 2026   |   New York

Contacts

KBRA affirms the A- insurance financial strength rating (IFSR) for GCU. The Outlook is Stable.

The rating reflects GCU’s (“GCU” or “the Society”) sound capitalization, conservative balance sheet, and improving portfolio composition and credit mix, which together support financial stability despite margin pressure associated with its interest-sensitive liability profile. As of YE 2024, risk-adjusted capitalization remained adequate, supported by disciplined capital management and a conservative investment profile. The investment portfolio remains heavily weighted toward fixed income, with approximately 93% of invested assets in bonds, the vast majority of which are investment grade. Credit quality has improved over the past two years, supported by active portfolio repositioning, a continued reduction in lower-rated exposures relative to surplus, and enhanced asset-liability alignment.

These strengths are balanced by GCU’s highly concentrated business profile and exposure to interest-rate-driven spread compression. Approximately 96% of reserves remain tied to interest-sensitive annuity products, increasing sensitivity to reinvestment risk, competitive crediting dynamics, and policyholder behavior. Operating performance weakened in 2024 following reserve strengthening and sustained margin pressure; however, results showed improvement toward breakeven during 2025 as surrender activity moderated, investment performance improved, and management actions took effect. While margins on new business have improved relative to the in-force block, overall earnings remain below historical levels and constrained by competitive pressures and limited business diversification.

To access ratings and relevant documents, click here.

Click here to view the report.

Methodologies

Disclosures

Further information on key credit considerations, sensitivity analyses that consider what factors can affect these credit ratings and how they could lead to an upgrade or a downgrade, and ESG factors (where they are a key driver behind the change to the credit rating or rating outlook) can be found in the full rating report referenced above.

A description of all substantially material sources that were used to prepare the credit rating and information on the methodology(ies) (inclusive of any material models and sensitivity analyses of the relevant key rating assumptions, as applicable) used in determining the credit rating is available in the Information Disclosure Form(s) located here.

Information on the meaning of each rating category can be located here.

Further disclosures relating to this rating action are available in the Information Disclosure Form(s) referenced above. Additional information regarding KBRA policies, methodologies, rating scales and disclosures are available at www.kbra.com.

About KBRA

Kroll Bond Rating Agency, LLC (KBRA), one of the major credit rating agencies (CRA), is a full-service CRA registered with the U.S. Securities and Exchange Commission as an NRSRO. Kroll Bond Rating Agency Europe Limited is registered as a CRA with the European Securities and Markets Authority. Kroll Bond Rating Agency UK Limited is registered as a CRA with the UK Financial Conduct Authority. In addition, KBRA is designated as a Designated Rating Organization (DRO) by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized as a Qualified Rating Agency by Taiwan’s Financial Supervisory Commission and is recognized by the National Association of Insurance Commissioners as a Credit Rating Provider (CRP) in the U.S.

Doc ID: 1013120