Fitch Ratings-London/Milan-28 March 2011: Fitch Ratings has revised the rating outlook for the Italian non-life insurance market to stable from negative, on the grounds of improving profitability driven by premium rises and better risk selection.
Fitch says in a newly-published report that trading conditions in the Italian non-life insurance market are improving, after two years of weak operating performance.
“There is a stronger degree of consensus among market participants regarding the need to raise tariffs to restore profitability, as well as more evidence that the operating environment, and regulatory aspects in particular, could support the non-life industry in its recovery,” says Federico Faccio, Senior Director in Fitch’s Insurance team. “However, the speed at which non-life insurers have responded to the sharp deterioration of the underwriting conditions in 2009 and 2010 has varied between market participants, with higher rated companies having been quicker to respond.”
In the life sector, higher interest rates should compensate for the lower fee-based income from declining sales, resulting in resilient operating profitability for the sector as a whole.
Fitch will hold a teleconference to discuss the main findings described in the report. Details of the call will be announced shortly.
The report entitled ” Non-Life: Recovery Underway; Life: Sales Fading, But Profitability Holding Up”, is available on www.fitchratings.com.
Source : Fitch Ratings Press Release
