Demotech Assigns Financial Stability Rating® to Hermann Sons Life

Columbus, Ohio, December 14, 2021: Demotech, Inc. is proud to announce that Hermann Sons Life Insurance Company, a fraternal benefit society, has earned a Financial Stability Rating® (FSR) of A, Exceptional.  According to Joseph Petrelli, President and co-founder, Demotech “The mission of Hermann Sons Life is to strengthen communities through financial protection and service. It offers a variety of life insurance plans and annuity products.  Their more than 64,000 policyholder members belong to one of 125 local lodges across Texas.  One of the more visible contributions to its communities is a youth camp in Comfort, TX and tuition-free dance schools for its younger members as well as a retirement home for older members.” 

Sharon Romano Petrelli, CPCU, AIAF, CCP, ARC, Vice President and co-founder, noted that “for more than a century, fraternals have embodied the principles driving contemporary environmental, social and governance standards, ESG. Fraternals have operated through local lodges that focus on volunteerism to enhance the quality of life in the community; using charitable, educational, social, and other initiatives. Importantly, they do so under the auspices of state departments of insurance, and federal regulations, i.e., they are 501(c)(8) not-for-profit organizations.  If one focuses on ESG principles, I respectfully suggest that fraternals developed the original business model to focus on ESG.  We are pleased to acknowledge that Hermann Sons Life can execute their important mission and retain the financial stability to serve its members.” 

Romano Petrelli also stated, “Our mission statement has and always will reference ‘innovative solution to financial analysis issues.’  The innovation that we bring to each of the sectors that we create or review is our focus on the relative ability of an entity to execute its business model, address its stated objective, and meet the needs of stakeholders.  Once the capability to execute a business model is in place, profitability size, and scale become important factors for some business models but not for all business models.  Absent execution of its business model; size, in and of itself, can result in ‘too big to fail.’  Financially stable entities meet the needs of their constituencies by remaining ‘too focused to fail.'”

Petrelli expanded on the innovative solution that Demotech brought to the ratings sector:  “The perspective that increased year over year earnings, markedly more profitable quarterly operating results, or insulating operating results from the net impact of catastrophic events is required to sustain or improve the rating of all insurers fails to recognize or respect their underlying business models.  This perspective superimposes the business model of a publicly traded company, which attracts capital by securing unrealized appreciation and the payment of dividends.  Clearly, all insurers do not utilize this business model as all insurers are NOT publicly traded.

“Since 1861, Hermann Sons Life, as a fraternal benefit society meeting section 501(c)(8) of the IRS code, has embodied the principles that Demotech’s review and analysis process recognizes and respects. At every point in our more than 150-year history we have had the financial stability to meet our obligations to our members, their families and the communities that our lodges serve.” 

Robin Czarnek, Vice President of Sales for Hermann Sons Life found Demotech’s ratings to be invaluable during her time as an agency owner.  Czarnek stated, ”Hermann Sons Life is honored to have earned an FSR of A from a well-respected rating firm, Demotech.  Demotech has been at the forefront of innovation in the insurance ratings marketplace.  Their unprecedented approach has played a vital role in the industry allowing them to serve the needs of unique carriers such as fraternals and geographically based firms.  When industry experts researched the survival rates of carriers reviewed by Demotech and compared those survival rates to those competing rating agencies, Demotech consistently exceeded its own published expected results at each level of rating while comparing favorably to the other rating services.”

About Demotech, Inc.

Demotech, Inc. is a financial analysis firm specializing in evaluating the financial stability of regional and specialty insurers.  Since 1985, Demotech has served the insurance industry by assigning accurate, reliable, and proven Financial Stability Ratings® (FSRs) for Property & Casualty insurers and Title underwriters.  FSRs are a leading indicator of financial stability, providing an objective baseline of the future solvency of an insurer.  Demotech’s philosophy is to review and evaluate insurers based on their area of focus and execution of their business model rather than solely on financial size.  Demotech was the first to review and rate independent regional and specialty insurers. Demotech’s consistently increasing list of accreditations and acceptances has resulted in rating and reviewing more than 400 insurers operating in the US.  Visit for additional information.

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