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Standard & Poor’s Ratings Services says it is maintaining its negative outlook on the U.S. life insurance sector.
S&P, New York, has had a negative outlook on the sector since October 2008.
Since then, there have been many downgrades, and there likely will be more downgrades than upgrades over the next 6 months to a year, S&P says in a summary of the article.
"Downgrades generally will be limited to one or two notches,” S&P says. “The life insurance business remains among the safest of all financial enterprises--profitable, predictable, and relatively stable."
But “this recession, which will likely be the worst economic downturn since the 1930s, has dampened life insurers’ investment portfolios and earnings,” S&P says. “At the same time, their access to the credit markets is limited, reducing their financial flexibility and pressuring holding-company liquidity.”