USAA ratings affirmed by AM Best with stable outlook

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USAA ratings affirmed by AM Best

Highlights

AM Best affirms A++ Financial Strength Rating and 'aaa' Long-Term Issuer Credit Ratings with stable outlooks for all USAA group insurers and debt programs.
Improved operating performance for USAA property/casualty, aided by rate increases and loss management, drives better 2025 results with lower net catastrophe losses and favorable non-catastrophe loss trends.
USAA Life receives $300 million of parent capital support in 2025 amid direct premium growth and profitability, maintaining strong capitalization and balance sheet strength.

Rating action covers insurers and debt programs

As reported by AM Best, the agency affirms the Financial Strength Rating of A++ and the Long-Term Issuer Credit Ratings of "aaa" for United Services Automobile Association and its property/casualty and life/health subsidiaries, with stable outlooks. It also affirms the Long-Term Issuer Credit Rating and Long-Term Issue Credit Rating of "aaa" for USAA Capital Corporation's medium-term note program and senior unsecured medium-term notes, as well as the Short-Term Issue Credit Rating of AMB-1+ for its commercial paper program.

The affirmed entities include USAA Casualty Insurance Company, USAA General Indemnity Company, USAA Limited in the UK, USAA County Mutual Insurance Company, USAA Life Insurance Company and USAA Life Insurance Company of New York. AM Best also lists affirmed ratings on USAA Capital Corporation's $500 million 5.25% notes due 2027, $500 million 4.375% notes due 2028 and $400 million 2.125% notes due 2030, alongside the senior unsecured medium-term note program under its universal shelf registration.

All companies are domiciled in San Antonio, Texas, unless otherwise noted. The agency says the stable outlook reflects strong balance sheet fundamentals, operating performance and risk management across the organization.

Operating performance and capitalization support outlook

AM Best says the ratings of USAA and its property/casualty affiliates reflect balance sheet strength assessed at the strongest level, strong operating performance, a very favorable business profile and appropriate enterprise risk management. The agency also points to the historical contribution of the property/casualty group to the wider USAA organization, describing it as strategically integral.

USAA serves 14.3 million members through insurance and other financial services, including USAA Federal Savings Bank, and ranks among the top 10 writers of personal lines products in the U.S. based on premiums written. AM Best says the property/casualty group reports improved operating performance in recent years, helped by rate increases and underwriting and claims actions to manage volatility, while 2025 results benefit from lower net catastrophe losses and favorable non-catastrophe loss trends in personal auto and homeowners lines.

The agency adds that technology investment and direct-to-consumer marketing keep expense ratios well below its personal lines composite average, while diversified products and brand strength support high member retention. As of Dec. 31, 2025, USAA's unadjusted debt-to-total capital ratio, excluding accumulated other comprehensive loss, is 16.8% including Federal Home Loan Bank borrowings, and interest coverage improves in 2025.

For USAA Life Insurance Company and USAA Life Insurance Company of New York, AM Best says the ratings reflect very strong balance sheet strength, strong operating performance, a favorable business profile and appropriate enterprise risk management. The life group maintains a long-term trend in direct premium growth, continued profitability supporting capitalization, and receives $300 million of parent capital support in 2025 to back future growth.

Our earlier article on retirement income security in U.S. workplace plans explained that annuity-style “guaranteed income” features inside target-date funds are growing in assets, but still represent only a very small slice of the overall market. We noted that adoption by plan sponsors remains limited even as policymakers look to make it easier to include lifetime-income strategies in defined contribution plans and large providers continue expanding these offerings.

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