Primerica Life Insurance Co. and two of its subsidiaries had their ratings placed under review by A.M. Best with negative implications.

The ratings service said the financial strength rating of A+ and issuer credit ratings of “aa-” of Boston-based Primerica Life Insurance Co. and its subsidiaries, National Benefit Life Insurance Co. of New York, N.Y., and Primerica Life Insurance Co. of Canada, known collectively as Primerica Life, were under review.

The action, A.M. Best said, comes following the announcement by Citigroup that it will hold an initial public offering for shares of Primerica Inc., the newly established holding company for Primerica Life and its affiliates.

The ratings service said it expects Citigroup to “divest completely” of Primerica Inc., soon after the completion of the IPO, planned for early 2010.
Before the completion of the offering, Primerica, Inc. will enter into four coinsurance agreements with three affiliates of Citigroup, where the vast majority of Primerica Life’s term life insurance policies in-force as of Dec. 31 will be ceded to Citigroup. The reinsurance transactions will include the transfer of a substantial portion of Primerica Life’s reserves and assets, according to A.M. Best.

Primerica Life and its affiliates’ ratings will remain under review pending the successful completion of the IPO and A.M. Best’s discussions with management regarding Primerica Inc.’s future operating projections, investment portfolio and capital structure.