Moody's ups outlook to positive on Peru's Rimac Seguros

Moody's Investor Service affirmed Peruvian insurer Rimac Seguros' Baa3 insurance financial strength rating (IFS) and changed its outlook to positive from stable. The ratings affirmation is based on Rimac's leadership in the local insurance market, good product diversification and profitability and its affiliation with Peruvian financial group and majority-owner Grupo Breca, Moody's said in a press release. "Rimac benefits from its integration and synergies with Grupo Breca, given the wide presence of the group in the Peruvian economy, thereby leveraging Rimac's operations." In assigning Rimac a positive outlook Moody's noted the firm's improving investment diversification, favorable reserve development and solid underwriting results from its general insurance segments. The positive outlook also reflects Moody's view that Rimac's asset quality and financial flexibility will improve enough to justify a higher rating should Peru's sovereign credit rating (currently Baa2, positive outlook) be upgraded, Moody's added. Future ratings changes will follow Peru's sovereign credit rating and or developments in Rimac's asset quality. Rimac's chance for an upgrade would also be greatly improved by a reduction of its exposure to the catastrophe segment, Moody's said. Rimac is a major distributor of P&C, life and health insurance to individuals and companies. The firm recently launched policies that insure jewelry backed loans.