Standard & Poor’s Ratings Services announced it revised the outlook on all entities of the Netherlands-based Eureko insurance group (Eureko) to negative from stable. At the same time, S&P affirmed its ratings on the group, including its “A+” long-term counterparty credit and insurer financial strength ratings on the operating entities.
“The outlook revision reflects Standard & Poor’s concern that the group’s improving earnings over the short to medium term may not be sufficient to rebuild capital to a level more consistent with the ratings,” said S&P credit analyst David Laxton.
The ratings on Eureko reflect the group’s strong business position, strong and improving underwriting performance, and good although weakened capitalization. These positive factors are offset by restricted financial flexibility (defined as the ability to source capital relative to requirements).
The negative outlook reflects the risk that Eureko’s capitalization may remain inconsistent with the current rating level.
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