Moody’s Changes Outlook On US Life Insurance Industry To Stable

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May 18, 2010 Tuesday

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Moody's changes outlook on US life insurance industry to stable

Jasir Jawaid

Moody's revised its outlook on the U.S. life insurance industry to stable from negative, citing favorable economic and capital market trends that may stabilize these insurers' business and financial prospects.

Moody's on May 17 revised its outlook on the U.S. life insurance industry to stable from negative, citing favorable economic and capital market trends that may stabilize these insurers' business and financial prospects.

The rating agency noted that life insurers will show improved investment income, operating income and net profits, leading to stronger internal capital generation.

The rating agency also said the likelihood of a downside stress scenario occurring and its adverse impact on the life industry are diminished now, given the improving environment and the significant additional capital and liquidity buffers raised by the industry in recent quarters.

"U.S. life insurers are simply in a much better position now than they were a year ago to weather a second downturn, should one occur," said Laura Bazer, a Moody's vice president and senior credit officer, who wrote the new Moody's report that discusses the revised outlook.

May 24, 2010