Fitch Completes Insurance Notching Review for U.S. Life Insurance
SUMMARY OF RATING ACTIONS
The review resulted in 28 life insurance group rating affirmations.
A link to a summary report that details all of the rating actions taken as part of the portfolio review is available at the end of this release.
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 the Fitch website;
--Primary analyst and secondary analyst contact information;
--Participation status.
Fitch published updated insurance notching criteria on July 14, 2015, following publication of an initial exposure draft of proposed criteria on May 12, 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 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 U.S. and similarly regulated countries.
KEY RATING DRIVERS
For this ratings review, the key rating driver was the impact of updated notching criteria. See most recently published rating action commentaries or research reports for additional information on other Key Ratings Drivers pertinent to specific entity ratings.
RATING SENSITIVITIES
Not applicable to this portfolio review given its limited focus on implementation of updated notching criteria. See most recently published rating action commentaries or research reports for additional information on Rating Sensitivities pertinent to specific entity ratings.
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