Emirates Insurance Co. (PSC) 'BBB+' rating assigned; outlook stable

The outlook is stable.

"The ratings on United Arab Emirates (UAE)-based composite insurer EIC reflect strong capitalization, strong earnings, and strong liquidity," said Standard & Poor's credit analyst Kevin Willis.

These positive factors are partially offset by high reinsurance dependence and a concentrated equity investment portfolio within the UAE.

Standard & Poor's currently views the outlook on EIC as stable, expecting the company to sustain strong capitalization and strong earnings with strong liquidity.

The competitive position will become more widely sourced from within the UAE, reducing the Abu Dhabi entrenchment.

"The investment portfolio allocation will trend toward greater diversification and a reduced focus on equities, reducing investment leverage," added Mr. Willis.

Changes to the rating level are not expected in the medium term, but positive rating action will be driven by enhanced diversity and scale of EIC's competitive position in the UAE, combined with sustained strong earnings, and the expected greater focus/implementation of enterprise risk management.

Negative rating action would be prompted by any marked weakening of its competitive position, capitalization, or earnings.