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June 12 (Reuters) - (The following statement was released by the rating agency)
Fitch Ratings has affirmed and withdrawn its Insurer Financial Strength (IFS) Ratings on Insurance Australia Group's (IAG) core operating subsidiaries, Insurance Australia Limited (IAL) and IAG New Zealand Limited (IAGNZ), at 'AA-'. The Outlook is Stable. Fitch has decided to discontinue the ratings, which are uncompensated.
The ratings affirmation reflects IAG's dominant market position in its core markets which Fitch expects will increase further with the acquisition of Wesfarmers Limited's insurance underwriting operations.
The group's risk profile is supported by a solid franchise that includes a suite of strong brands. IAG's investment strategy is conservative, financial leverage is low, underwriting exposures are well supported through an extensive property catastrophe reinsurance programme, capital ratios are adequate given the group's high ratings, and the outlook for the operating environment is sound.