ITALY – Italian insurance sector outlook remains negative

Fitch Ratings says that the Italian insurance sector’s rating outlook remains ‘A-’ negative, indicating that most Italian life insurer ratings could be downgraded over the next 12-24 months. Fitch’s outlook factors in the expectation that the euro zone debt crisis, despite showing signs of stabilization, will continue to exert negative pressure on Italian insurers’ ratings in the short to medium term. Being highly exposed to the euro zone debt crisis through its significant holdings of Italian sovereign debt, Italian insurers hold ¤230 billion of government bonds in their investment portfolios and another ¤90 billion of corporate bonds, most of them from banks, according to the latest estimates released by the Association of insurance companies (ANIA).