Fitch Ratings has assigned its 'A' insurer financial strength rating to Zurich Insurance Company.
The rating means Fitch views Zurich Financial Services' insurance division as having sound financial strength and security. The outlook for the ratings was negative.
A Fitch statement said the ratings reflect the company's improving market conditions and the progress made by management in reshaping the Zurich group.
The agency did warn that Zurich's recent poor earnings and the risk of future reserve development posed a risk in the future.
A Fitch statement said: "ZFS has a strong market position in each of its core markets and is well placed to benefit from the current favourable pricing environment. The agency believes that the greater degree of focus to the group will benefit management control and should ultimately lead to improved results.
"ZFS continues to expect an improvement in underlying operational performance by USD1bn after tax for 2003 as a result of its profit improvement program. The group also expects to successfully complete its announced USD5bn risk based capital improvement by early 2004. Fitch will be closely monitoring the progress of management on their restructuring plans and reserving development."
