The insurance industry won't suffer from a capital exodus despite Creechurch's decision to postpone its planned floatation.
Speaking to Insurance Times Fitch Ratings' David Wharrier said despite yesterday's decision by the Lloyd's insurer to postpone its flotation, investors are unlikely to abandon future insurance industry propositions.
He said: "The Creechurch postponement is not the thin end of the wedge. It is true many insurers have raised capital at heavily discounted rates.
"However the current position of the market is sufficiently attractive and there are plenty of good business propositions in the industry to ensure many successful flotations."
Creechurch blamed its postponement on difficult market conditions. Last year ratings agency Moody's downgraded the insurer to "C plus" from "B minus" citing uncertainty over its future capital support. This year Moody's placed the performance rating of syndicate 962 on review for possible upgrade.
One market analyst said that while investors are generally positive towards the industry, investors might have been deterred by Creechurch's capital reserving problems.
He pointed out that, on one occasion, Creechurch had been forced to increase reserves for losses arising from previous years of account on syndicate 1607.
Creechurch was not available for comment.
