COVID-19: Capital strength will save insurers, S&P contends

Insurers' capital strength may save the sector as it faces off the COVID-19 pandemic, but it will not spare them all from downgrades as the coming weeks reveal other, prior weaknesses.

This is according to S&P Global Ratings, whose analysts believes general insurance to be better placed than life, which is more likely suffer from its exposure to ongoing financial market volatility.

"Currently, the average rating across the industry is 'A', the highest average rating for any corporate or financial services industry we rate. As with other investment-grade issuers, we don't anticipate widespread downgrades across the industry," the ratings firm stated.

"Nevertheless, some ratings will be affected. To date, we have downgraded one insurer and placed two insurance ratings on a negative outlook or CreditWatch. In each case, the implications of COVID-19 had compounded other factors, causing creditworthiness to deteriorate."

S&P forecasts a global recession in 2020 as a result of the COVID-19 pandemic.

    Share Story:

YOU MIGHT ALSO LIKE

BANNER

Resilience Rooted in Reality
In this podcast, CIR speaks to CLDigital’s Tejas Katwala about why organisations must move beyond checklist compliance to build living, data driven resilience. He explains how rethinking governance, risk and compliance, breaking down silos and focusing on value streams can create sustainable, real time resilience that is rooted in the way businesses actually operate today.

Building cyber resilience in a complex threat landscape
Cyber threats are evolving faster than ever. This episode explores how organisations can strengthen defences, embed resilience, and navigate regulatory and human challenges in an increasingly complex digital environment.