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Credit Hotspot: Insurance Consolidators

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EMEA CLOs Largely Resilient to Underlying Asset Downgrades

EMEA CLO ratings show high resilience to negative migration in the underlying loan portfolio, Fitch Ratings says. Our stress test shows that the CLO rating impact would be limited even if all underlying assets rated 'B-' were downgraded to 'CCC'. 

UK Bulk Annuity Market Growth Set to Continue

Fitch Ratings expects bulk annuities to continue to benefit from strong demand for pension de-risking solutions from corporates on the back of reduced funding gaps and attractive pricing that makes buy-ins and buy-outs more affordable. However, bulk sales growth could slow if competition from alternative offerings, such as pension superfunds, intensifies.

UK Bulk Annuity Market Benefits From Strong Demand, Regulation

UK life insurers that write bulk purchase annuities (BPAs) continue to benefit from strong demand, with sales of BPAs this year likely to surpass last year's GBP24 billion, the highest yet. Strong demand and high barriers to entry, including onerous Solvency II regulatory capital requirements, are credit positive for incumbents. 

UK Pension Superfunds Impact on Insurers Hinges on Capital Rules

The threat to UK insurers' bulk purchase annuity (BPA) business pipeline from the launch of pension superfunds will depend on how much capital the superfunds have to hold. If superfunds are allowed to operate with much less capital than insurers have to hold for BPAs under Solvency II, they will be a considerable threat as the lower capital costs will enable them to offer a significantly more attractive price to employers looking to offload their defined-benefit pension liabilities.

Fitch Affirms Pension Insurance Corp's 'A+' IFS Rating; Outlook Stable

Fitch has simultaneously affirmed PIC's subordinated notes' 'BBB+' rating reflecting their subordination and loss-absorption features, in line with Fitch's notching criteria.

Fitch Affirms Legal & General's IFS at 'AA-'; Outlook Stable

Fitch has also affirmed Legal & General Reinsurance Company Limited's (L&G Re) IFS Rating at 'A+.'

Fitch Revises Just Retirement Limited's Outlook to Stable; Affirms IFS at 'A+

Fitch Ratings has revised Just Retirement Limited's and Just Group plc's (Just Group) Outlooks to Stable from Negative. The agency also affirmed Just Retirement Limited's Insurer Financial Strength (IFS) Rating at 'A+' and the Long-Term Issuer Default Ratings (IDR) of Just Retirement Limited and Just Group , the group's ultimate holding company, at 'A'.

rating action

Athora Life Re and Athora Ireland IFS 'BBB+'; Outlook Stable

The ratings reflect Athora Re's short operating history and limited track record, its expected relatively high investment risk, strong asset/liability management (ALM) and liquidity, as well as strong capitalisation and leverage.

Consolidators: a New Reality for European Life Insurance?

Fitch recently held an event in London discussing the topic of insurance consolidators. In addition to presentations from Fitch Ratings, Generali Deutschland and Viridium, there were 2 lively panel discussions. To receive a copy of the presentations from the event, click here.

rating action

Fitch Rates Phoenix's Proposed Subordinated Tier 2 Euro Notes 'BBB'

Fitch Ratings has assigned Phoenix Group Holdings' (Phoenix; IDR A/Stable) proposed dated subordinated Tier 2 Euro notes issue a 'BBB' rating. The notes are rated three notches below Phoenix's IDR, comprising two notches for expected recovery and one for moderate non-performance risk.

rating action

Fitch Rates Standard Life Assurance at IFS 'A+'; Affirms Phoenix at IFS 'A+'; Outlooks Stable

Fitch Ratings has assigned Standard Life Assurance Limited (SLAL) an Insurer Financial Strength (IFS) Rating of 'A+' with a Stable Outlook, following Phoenix's announcement that the acquisition of SLAL from Standard Life Aberdeen plc (SLA plc) was completed on 31 August 2018, consistent with Fitch's expectations.

Fitch Rates Rothesay's Restricted Tier 1 Notes 'BBB-'

Fitch Ratings has assigned Rothesay Life Plc's (Issuer Default Rating (IDR) A/Stable) GBP350 million restricted Tier 1 subordinated notes (XS1865334020) a rating of 'BBB-'.

Fitch Affirms Athene's Ratings; Outlook Revised to Positive

Fitch Ratings has affirmed the 'A-' (Strong) Insurer Financial Strength (IFS) ratings of Athene Annuity & Life Assurance Company, Athene Annuity and Life Company, Athene Annuity & Life Assurance Company of New York, and Athene Life Re Ltd. (collectively referred to as Athene). Fitch has also affirmed the Long-Term Issuer Default Rating (IDR) of Athene Holding Ltd. at 'BBB'. 

Fitch Revises Just Retirement Limited's Outlook to Negative; Affirms IFS at 'A+'

Fitch Ratings has revised Just Retirement Limited's and Just Group plc's (Just Group) Outlooks to Negative from Stable. The agency has affirmed Just Retirement Limited's Insurer Financial Strength (IFS) Rating at 'A+' and the Long-Term Issuer Default Ratings (IDR) of Just Retirement Limited and Just Group , the group's ultimate holding company, at 'A'. 

rating action

Fitch Publishes 'BBB+' Rating for Pension Insurance Corp.'s Proposed Subordinated Debt

Fitch Ratings has published a debt rating of 'BBB+' for Pension Insurance Corporation Plc's (PIC) proposed issue of subordinated Tier 2 notes. The proposed subordinated notes are rated two notches below PIC's Issuer Default Rating (IDR) of 'A'/Stable, comprising one notch for expected recovery and one notch for moderate non-performance risk.

Generali a Forerunner to More German Life Run-off Deals

The announcement that Generali has agreed to sell 89.9% of Generali Leben to Viridium reinforces our expectation that disposal of closed funds will be a growing theme in the German life insurance market. The transaction would be the largest run-off deal in Germany to date, covering traditional-business reserves of about EUR37 billion, and could pave the way for more large deals.

UK Bulk Annuity Market Growth to Continue

The BPA market is being driven by corporate pension scheme sponsors' desire to offload defined benefit funding risk. With a total addressable DB market size of GBP2.3 trillion, the opportunity for insurers is significant. 

Italy Life Insurer Run-Off Books May Prompt Consolidation

Closed-fund consolidation will become a feature of the Italian life insurance market after a new profit-sharing system, recently launched by the Italian regulator, is implemented by insurers later this year.

Yields, Solvency 2 to Spur German Life Insurance Run-Offs

Low investment returns and higher capital requirements on some business could drive a two-thirds increase in the volume of German life insurance portfolios in run-off over the next five years.

UK Annuity Market

Key discussion points included:

  • Bulk annuity market - drivers and constraint
  • Impact of Solvency II
  • Fitch's approach to rating annuity providers



Harish Gohil


+44 20 3530 1257


David Turner


+44 20 3530 1442

North America

Brad Istwan


+1 312 368 3197

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