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Insurance ratings actions: S&P acts on Tokio Marine subsidiaries after deal news

S&P Global Market Intelligence compiles ratings actions in the insurance space daily through 5 p.m. ET. Actions after 5 p.m. ET will be included in the following day's roundup.

U.S. and Canada

S&P Global Ratings placed the A- long-term issuer credit rating of HCC Insurance Holdings Inc. and the AA- financial strength and long-term issuer credit ratings of the company's core and guaranteed operating companies on CreditWatch with negative implications.

The action follows the announcement that Tokio Marine Holdings Inc. will acquire Pure Group through its wholly owned subsidiary, HCC Insurance. The action recognizes the limited information on the financing to support the deal. The CreditWatch is expected to be resolved in the next three to six months after the transaction closed and the deal financing solidified.

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A.M. Best affirmed the financial strength rating of A+ and the long-term issuer credit ratings of "aa" of the life/health and property/casualty subsidiaries of Delphi Financial Group Inc., a direct subsidiary of Tokio Marine & Nichido Fire Insurance Co. Ltd., whose ultimate parent is Tokio Marine Holdings.

The life/health subsidiaries are Reliance Standard Life Insurance Co. and First Reliance Standard Life Insurance Co. The property/casualty subsidiaries are Safety National Casualty Corp., Safety Specialty Insurance Co. and Safety First Insurance Co.

The rating agency also affirmed the long-term issuer credit rating of "a" and the existing long-term issue credit ratings of Delphi Financial Group.

The outlook is stable.

The ratings of the life/health subsidiaries reflect their balance sheet strength, which A.M. Best categorizes as strong, as well as their strong operating performance, neutral business profiles and very strong enterprise risk management.

The ratings of the property/casualty subsidiaries reflect their balance sheet strength, which A.M. Best categorizes as strongest, as well as their strong operating performance, neutral business profiles and very strong enterprise risk management.

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A.M. Best affirmed the financial strength rating of A and the long-term issuer credit rating of "a" of American Road Insurance Co. The outlook is stable.

The ratings reflect the company's balance sheet strength, which the rating agency categorizes as strongest, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management.

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Demotech assigned a financial stability rating of A, Exceptional, to Kin Interinsurance Network, Cornerstone National Insurance Co., Providence Indemnity Insurance Co. Ltd. and SCK Assurance Co. Ltd.

The A, Exceptional, rating is assigned to insurers that possess exceptional financial stability related to maintaining positive surplus in connection with policyholders, liquidity of invested assets, an acceptable level of financial leverage, reasonable loss and loss adjustment expense reserves and realistic pricing.

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Moody's affirmed the B3 corporate family rating and B3-PD probability of default rating of NFP Corp. after the announcement that it intends to issue $250 million of new senior unsecured notes. The outlook is stable.

The ratings recognize NFP's expertise and solid market position in insurance brokerage.

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Moody's withdrew the Baa1 long-term issuer rating of Validus Holdings Ltd. for business reasons.

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A.M. Best upgraded the financial strength rating to B+ from B and the long-term issuer credit rating to "bbb-" from "bb+" of Equitable Life & Casualty Insurance Co. The outlook was revised to stable from positive.

The upgrade was based on the company's improved operating performance. The ratings reflect Equitable's balance sheet strength, which A.M. Best categorizes as adequate, as well as its adequate operating performance, limited business profile and marginal enterprise risk management.

Europe

Moody's affirmed the A1 insurance financial strength rating of Bupa Insurance Ltd., the main U.K. private medical insurance business of Bupa. The outlook is stable.

The affirmation reflects, among others, Bupa's geographically diverse portfolio, relatively low risk profile and good capitalization level.

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S&P Global Ratings affirmed the A long-term insurer financial strength and issuer credit ratings of Länsförsäkringar Sak Försäkrings AB (publ), a core subsidiary of Lansforsakringsgruppen.

The rating agency also affirmed the A- long-term local and foreign currency issuer credit rating of Länsförsäkringar AB (publ), the intermediate holding company.

The outlook is stable, mirroring the rating agency's view that Lansforsakringsgruppen will keep its leading position in the Swedish nonlife market, supported by sound underwriting results and extremely strong capitalization.

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S&P Global Ratings affirmed the A- long-term issuer credit and insurer financial strength ratings of Assurances Continentales-Continentale Verzekeringen NV, which was acquired by Navigators Group Inc. in 2018.

The outlook is stable, reflecting the rating agency's view that the Belgian insurer will generate break-even operating results.

Asia-Pacific

S&P Global Ratings affirmed the A+ financial strength and long-term issuer credit ratings of Tokio Marine Holdings' operating companies that it considers as core to the group.

The rating agency also affirmed the A+ financial strength ratings of an overseas branch of Tokio Marine & Nichido Fire and a subsidiary with insurance payment obligations that Tokio Marine & Nichido Fire guarantees. The short-term issuer and issue credit ratings of Tokio Marine & Nichido Fire and issue rating of Tokio Marine & Nichido Life Insurance Co. Ltd. were also affirmed.

The outlook on the long-term credit ratings remains positive, reflecting S&P Global Ratings' view that its sovereign credit rating on Japan has an impact on Tokio Marine Group's creditworthiness, considering that most of the group's business and investment assets are concentrated in the country.

The ratings actions come after the announcement of the Pure Group deal, a transaction that is expected to have limited impact on the rating agency's assessment of Tokio Marine Group's credit profile.

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A.M. Best revised the outlook to negative from stable for the long-term issuer credit rating and affirmed the financial strength rating of B++ and the long-term issuer credit rating of "bbb+" of EQ Insurance Co. Ltd. The outlook of the financial strength rating remains stable.

The credit ratings reflect the company's balance sheet strength, which A.M. Best categorizes as strong, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management.

This S&P Global Market Intelligence news article may contain information about credit ratings issued by S&P Global Ratings. Descriptions in this news article were not prepared by S&P Global Ratings.

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