(The following statement was released by the rating agency)
PARIS/LONDON, May 28 (Fitch) Fitch Ratings has affirmed
Vie's and Prevoir Risques Divers' Insurer Financial Strength
(IFS) ratings at
'A'. The agency has also affirmed Societe Centrale Prevoir's
holding company) Long-term Issuer Default Rating (IDR) at 'A-'.
The Outlooks are
KEY RATING DRIVERS
The ratings of all three entities (together referred to as 'the
their solid capital adequacy, resilient earnings generation and
strategy pursued by their management. Offsetting factors include
size, the current lack of geographical diversification, and a
exposure to equities and real estate investments. Their modest
scale and lack of
geographical diversification leave the group exposed to
changes in the French insurance sector.
Fitch believes that Prevoir Vie's and Prevoir Risques Divers'
will continue to be solid, significantly in excess of regulatory
At end-2013, the capital base of Prevoir Vie and Prevoir Risques
the minimum regulatory requirement by 5.2x and 15.9x
respectively when including
unrealised gains, and by 1.3x and 9.3x when excluding unrealised
group has not issued any financial debt and it has no intention
of raising any
in the foreseeable future.
Fitch expects Prevoir Vie and Prevoir Risques Divers to continue
strong earnings. At end-2013, net income reached EUR46m (2012:
driven by strong income from insurance activities (2013:
EUR26.7m) and supplemented by investment and other income (2013:
Despite premium growth in excess of the French life market, the
remains modest. Consolidated gross written premiums (GWP)
increased 10% in 2013
to EUR514m. The group outperformed the French insurance market,
premiums decreased by 9%. Growth was predominantly driven by
savings products and Prevoir Partenaire, the group's white label
offer, which reported a 104% increase in GWP to EUR32m, driven
by the addition
of new partnerships in 2013.
Fitch expects the group to continue to pursue a conservative
approach to avoid
significant business risks and to finance growth with its own
the proportion of investments allocated to high-risk assets
(equities and real
estate) is fairly high, the group maintains a significant
capital buffer against
potential market risks.
The IDR for Prevoir is one notch higher than it would be under
notching methodology. This reflects the holding company's lack
of financial debt
and its direct holdings of significant financial assets
(including cash) in
addition to its ownership of the two insurance operating
Key triggers for a downgrade would include a prolonged period of
performance with, for example, reported net income remaining
below EUR20m or a
significant decline in Prevoir Vie's Solvency I ratio including
to below 3.0x (end-2013: 5.2x) .
Fitch would also view negatively any unexpected significant
change in the
group's financial strategy and conservative management style, as
well as any
material change in the dividend policy.
A rating upgrade is unlikely in the medium term given the
concentration of its
operations on the French market. However, over the longer term,
in market share along with strong financial performance and
adequacy could result in an upgrade of the group's ratings.
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Additional information is available at www.fitchratings.com.
Applicable criteria, 'Insurance Rating Methodology', dated 13
November 2013 are
available at www.fitchratings.com.
Applicable Criteria and Related Research:
Insurance Rating Methodology
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