OREANDA-NEWS. August 03, 2015. Fitch Ratings has affirmed eight insurance groups based in South Africa or focused exclusively in the country following the application of its recently updated notching criteria for the insurance industry. A full list of rating actions is available at www.fitchratings.com or by clicking the link above.

The purpose of the review was to identify any ratings that should be changed as a result of the application of the updated notching criteria.

Fitch published updated insurance notching criteria on 14 July 2015, following publication of an initial exposure draft of proposed criteria on 12 May 2015. The updated notching criteria appear in Section VI of the insurance master criteria report Insurance Rating Methodology.

Notching refers to the practice of establishing a given rating relative to a defined "anchor" rating, using guidelines linked to certain characteristics of the rating that is being notched. For Fitch's insurance ratings, the Insurer Financial Strength (IFS) rating is the initial anchor rating, and other ratings that are notched relative to it include Issuer Default Ratings (IDRs) of operating and holding companies, and debt/hybrid obligation ratings.

Fitch updated its notching criteria in light of changes in the regulatory landscape, including the movement in Europe and other jurisdictions, such as South Africa, to Solvency 2 or a Solvency 2-type regulatory framework. As a result, from a global perspective, notching changes are more pronounced in Europe and other such jurisdictions, and more limited in the US and similarly regulated countries.

KEY RATING DRIVERS
For this review, the key rating driver was the impact of updated notching criteria. For the Key Ratings Drivers for a specific entity, see the most recently published Rating Action Commentaries or research reports.

RATING SENSITIVITIES
Not applicable to this portfolio review given its limited focus on implementation of updated notching criteria. For the Rating Sensitivities for a specific entity, see the most recently published Rating Action Commentaries or research reports.

SUMMARY OF RATING ACTIONS
A link to a summary report that details all of the ratings actions taken as part of the portfolio review is available by clicking the link above.

The linked summary report includes:
--A full list of ratings and related rating actions
--A hyperlink to each rated entity's ratings summary page on Fitch's website
--Primary analyst and secondary analyst contact information
--Participation status

The review has resulted in all ratings being affirmed.

LIMITATIONS
The portfolio review was limited in scope, and only included an assessment of updated notching criteria as outlined in Section VI (Notching: Debt, Hybrid, IFS Rating and Holding Companies) of Fitch's insurance master criteria. None of the factors outlined in Section I (Key Rating Factors) of the master criteria, or any other elements discussed in the master criteria, were reviewed. Where relevant, Fitch considered the appropriateness of the relative ranking of ratings in the South African insurance sector, after initial consideration of updated notching guidelines, as part of the portfolio review.