OREANDA-NEWS. Fitch Ratings has assigned UK insurer Ageas Insurance Limited (AIL) an Insurer Financial Strength (IFS) rating of 'A+', with Stable Outlook.

KEY RATING DRIVERS
Under Fitch's insurance rating methodology, the agency considers AIL as "Core" to the Ageas group (ultimate parent Ageas SA/NV; LT IDR BBB+/Stable) and has therefore aligned AIL's IFS rating with that of other core operating entities in the group.

Fitch's view that AIL is "Core" to Ageas is based on a number of factors:

- Strategic importance: AIL is a key contributor to Ageas's targets. The group's strategy is to develop its non-life business to rebalance the business mix between life and non-life. AIL integrated the former Groupama UK non-life business in 2013, increasing AIL's weight within the group non-life business. In addition, AIL's annual combined ratio has been below 100% and its return on equity (RoE) above 11% since 2011, in line with the group's target.

- Materiality: AIL is Ageas's main business in the UK, which is the second largest country by premiums for the group after Belgium. AIL is a material part of the Ageas group, accounting for around 20% of the group's gross written premiums (EUR1.8bn out of EUR9.2bn in 2014) and 11% of pre-tax profit (EUR86m out of EUR793m). AIL is expected to continue contributing positively to Ageas UK's and the Ageas group's profits.

- Consistency of branding: AIL was formerly Fortis Insurance before it was renamed in 2010. AIL carries the same brand name as the Ageas group.

- Support: There is a track record of support from Ageas to AIL. The group funded part of AIL's acquisition of Groupama UK via a capital injection and a loan to Ageas UK. The loan has been repaid. Fitch also believes that support to Ageas UK from the group would be forthcoming if needed.

RATING SENSITIVITIES
Changes in Ageas's ratings would be reflected in a corresponding change in AIL's IFS rating.

Also, a material deterioration of the company's profitability or market position could lead Fitch to no longer view AIL as "Core" to Ageas, triggering a downgrade.