Credit ratings

Principal Life Insurance Company, currently the largest operating company within the family of companies comprising the Principal Financial Group, and Principal National Life Insurance Company have received consistently high financial strength ratings from the rating agencies: A.M. Best Company, Moody's Investors Service, S&P Global, and Fitch Ratings.

Financial strength ratings

Issuer credit ratings

About the ratings

Financial strength ratings

A.M. Best's ratings for insurance companies range from "A++" to "S". A.M. Best indicates that "A++" and "A+" ratings are assigned to those companies that in A.M. Best's opinion have superior ability to meet ongoing obligations to policyholders.

Fitch's ratings for insurance companies range from "AAA" to "C". Fitch "AA" ratings indicate very strong capacity to meet policyholder and contract holder obligations on a timely basis.

Moody's Investors Service ratings for insurance companies range from "Aaa" to "C". Moody's Investors Service indicates that "A" ratings are assigned to those companies that offer good financial security.

S&P Global's ratings for insurance companies range from "AAA" to "NR". S&P Global indicates that "A" ratings are assigned to those companies that have strong financial security characteristics.

In evaluating a company's financial and operating performance, these rating agencies review its profitability, leverage and liquidity, as well as its book of business, the adequacy and soundness of its reinsurance, the quality and estimated market value of its assets, the adequacy of its policy reserves, the soundness of its risk management programs, the experience and competency of its management and other factors. We believe our strong ratings are an important factor in marketing our products to our distributors and customers, as ratings information is broadly disseminated and generally used throughout the industry. Our ratings reflect each rating agency's opinion of our financial strength, operating performance and ability to meet our obligations to policyholders and are not evaluations directed toward the protection of investors. Such ratings are neither a rating of securities nor a recommendation to buy, hold or sell any security, including our common stock.

Issuer credit ratings

Moody’s states that issuer ratings are opinions of the ability of entities to honor senior unsecured debt and debt like obligations. As such, Issuer Ratings incorporate any external support that is expected to apply to all current and future issuance of senior unsecured financial obligations and contracts, such as explicit support stemming from a guarantee of all senior unsecured financial obligations and contracts, and/or implicit support for issuers subject to joint default analysis (e.g. banks and government-related issuers). Issuer Ratings do not incorporate support arrangements, such as guarantees, that apply only to specific (but not to all) senior unsecured financial obligations and contracts.

An S&P Global Ratings issuer credit rating is a forward-looking opinion about an obligor's overall creditworthiness. This opinion focuses on the obligor's capacity and willingness to meet its financial commitments as they come due. It does not apply to any specific financial obligation, as it does not take into account the nature of and provisions of the obligation, its standing in bankruptcy or liquidation, statutory preferences, or the legality and enforceability of the obligation.

A Best’s issuer Credit Rating (ICR) is an independent opinion of an entity’s ability to meet its ongoing financial obligations and can be issued on either a long-or short-term basis.  A long-term ICR is an opinion of an entity’s ability to meet its ongoing senior financial obligations, while a short-term ICR is an opinion of an entity’s ability to meet its ongoing financial obligations with original maturities generally less than one year.  An ICR is an opinion regarding the relative future credit risk of an entity.  Credit risk is the risk that an entity may not meet its contractual financial obligations as they come due.  An ICR does not address any other risk.  In addition, an ICR is not a recommendation to buy, sell, or hold any securities, contracts or any other financial obligations, nor does it address the suitability of any particular financial obligation for a specific purpose of purchaser. An ICR may be displayed with a rating identifier or modifier that denotes a unique aspect of the opinion.