United Heritage Life Insurance Co. has strengthened its balance sheet and dumped poorly performing investments, resulting in a good year in 2010, said A.M. Best, which measures the financial strength of insurance companies.

The stable outlook means Best believes there is little likelihood that the company’s overall rating of A- — which is considered excellent — will drop in the near term, Best officials say.

The company reported $6 million in profits in 2010, up from $648,000 in 2009 and a $5.1 million loss in 2008.

The loss reflected the marking down of its bond investment to reflect the falling bond market, said Dennis L. Johnson, president of United Heritage and its holding company.

The company has 75,000 policy holders. It traces its roots to the Grange Mutual Life Insurance Co. in Nampa in 1934.

United Heritage Mutual Holding Co. owns the life insurance company and two property and casualty companies. Those two companies have 60,000 policyholders.

Best also raised the outlook for Sublimity Insurance Co., one of United’s property and casualty companies, from stable to positive, which indicates a near-term possibility of an overall rating upgrade of the company. Sublimity has a good rating on Best’s scale, meaning it’s in good shape to meet its obligations.

Life insurance companies hit hard times as markets collapsed in 2008-09. Best assigned a negative outlook to the entire industry in 2008 after Lehman Brothers’ bankruptcy and the AIG crisis that led to a federal bailout. Best cited “severe dislocation” in the capital markets, where insurance companies invest. Last July, Best raised the outlook to stable, saying the industry was adequately capitalized.

United Heritage’s outlook was dropped to negative in late 2010 and restored in May.

Bill Roberts: 377-6408