Following Moody’s change in outlook on the government of Italy (Baa3) to negative from stable, the agency has taken a number of rating actions on three Italian insurers and related subsidiaries.
Generali’s A3 insurance financial strength rating (IFSR) was affirmed with a stable outlook; and a similar action was taken on Generali’s Italian, French and German subsidiaries.
In Unipol’s case its Baa2 IFSR affirmed, but its outlook was changed to negative from stable. Allianz A3 IFSR was also affirmed, with its outlook remaining positive.
Moody’s said: “The change in outlook to negative for Unipol reflects the concentration of its assets and liabilities to Italy, while the affirmation of Generali’s ratings with a stable outlook reflects the group’s high degree of geographic diversification outside Italy, notably in Germany and France and the affirmation of Allianz S.p.A.’s rating with a positive outlook reflects high parental support from Allianz SE (Aa3 positive).”
The IFSRs of all three insurance groups remain above the sovereign rating, reflecting their ability to withstand severe stress on the sovereign.
Nevertheless, the agency considers that these insurers’ key credit fundamentals (asset quality, capitalisation, profitability and financial flexibility) are, in various degrees, influenced by the economic and market conditions in Italy, where they are domiciled and have significant operations.