Insurers’ asset risk on the rise: Fitch

Fitch Ratings has affirmed that Sri Lankan insurers’ asset risks have risen due to the sovereign’s weaker credit profile and the resultant lowering of some state-owned and private-sector institutions’ national ratings.

Fitch estimated that around 12 percent of the fixed-income investment portfolios of Fitch-rated insurers, or around 28 percent of deposits and debt instrument portfolios, were invested in these entities at end-June 2020. Sri Lanka’s regulatory RBC rules exempt debt securities issued or guaranteed by the government from charges on credit and concentration risks in the calculation of the regulatory capital ratio.