These credit ratings have been placed under review with negative implications due to heightened geopolitical, economic and financial system risk in Russia, where both Ingosstrakh and SOGAZ is domiciled and underwrite the majority of their business, said AM Best
London:
Post the wide ranging international sanctions against Russia, after it invaded Ukraine, by Western countries, international rating agency AM Best downgraded two Russian insurers Ingosstrakh Insurance Company PJSC (Ingosstrakh) and SOGAZ.
AM Best is working to understand the implications of international sanctions upon Russian entities, said the rating agency..
While AM Best has placed both Ingosstrakh and SOGAZ under review with negative implications on the two insurers’ financial strength rating of B++ (Good) and the Long-Term Issuer Credit Rating of “bbb”,
For SOGAZ, AM Best has also withdrawn the European Union-endorsed status of these Credit Ratings (ratings) following recent changes to EU sanctions.
These credit ratings have been placed under review with negative implications due to heightened geopolitical, economic and financial system risk in Russia, where both Ingosstrakh and SOGAZ is domiciled and underwrite the majority of their business, said AM Best.
The ratings will remain under review while AM Best evaluates the severity of the impact of international sanctions, imposed in response to the military conflict in Ukraine, on Russia’s economy and financial system, and the subsequent consequences for the credit profile of both the insurers.
Potential balance sheet and operational impacts include deterioration in the valuation and credit quality of investments, liquidity constraints, issues recovering from reinsurers and elevated claims costs, caution the rating agency.