Oct 9 - Fitch Ratings has issued a sector-specific special report describingthe credit factors the agency uses to analyze the U.S. Life Insurance Sector.
These sector-specific credit factors supplement the global master criteria'Insurance Rating Methodology', dated Sept. 19, 2012, which details key elementsof criteria that influence Fitch's core fundamental credit analysis of insurancecompanies and groups. This report is available at
Consistent with the global master criteria, companies in the U.S. Life Insurancesector are evaluated considering various qualitative and quantitative creditfactors, including but not limited to: industry profile and operatingenvironment, market position and size/scale, corporate governance,capitalization and leverage, financial performance and earnings, and liquidity.
In its new special report, Fitch has placed the various building blocks used toformulate its ratings within typical ranges to increase the transparency of itsanalysis. The report includes various median financial ratios by ratingcategory, as well as charts that demonstrate how key qualitative factors canimpact a typical rating range.
Ratings in Fitch's U.S. Life Insurance universe typically range between the'AAA' through 'BBB' category for Insurer Financial Strength (IFS) ratings andbetween 'AA' and 'BB' for holding company unsecured senior debt ratings. Keylife insurance industry risk factors include investment risk tied to fixedincome and equity holdings, margin pressures due to macroeconomic headwinds andintense price competition, asset/liability and liquidity management, andevolving regulatory, tax and accounting frameworks.
Additional information is available at '
Applicable Criteria and Related Research:--'Insurance Ratings Methodology', (Sept. 19, 2012).
Applicable Criteria and Related Research: Life Insurance (U.S.) Sector CreditFactors
Insurance Ratings Criteria: Application in a Stressful EnvironmentInsurance Rating Methodology
(New York Ratings Team)