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Investing.com -- Fitch Ratings has upgraded Unipol (BIT:UNPI) Assicurazioni S.p.A.’s Insurer Financial Strength (IFS) Rating to ’A’ from ’A-’ and its Long-Term Issuer Default Rating to ’A-’ from ’BBB+’. The outlook for both ratings is Stable.
The upgrade comes after a major reduction in Unipol’s financial leverage ratio as its €1 billion senior debt matured in March 2025 without being refinanced. This followed the December 2024 merger of UnipolSai Assicurazioni S.p.A. into Unipol Gruppo S.p.A., which was renamed Unipol.
Unipol’s financial leverage ratio improved significantly to approximately 18% at the end of the first quarter of 2025, down from 24% at the end of 2024. Fitch expects this ratio to remain stable through 2025 and 2026, with further reductions anticipated after the company announced it would not refinance its outstanding €500 million and €1 billion senior debt maturing in November 2027 and September 2030.
The company maintains very strong capitalization, with its Solvency 2 coverage ratio at 218% at the end of the first quarter of 2025, up slightly from 212% at the end of 2024. Fitch rates Unipol’s capital position as "Very Strong" based on its Prism Global model using end-2024 data.
Despite these strengths, Fitch notes Unipol’s high investment concentration in Italian sovereign debt as a risk factor. The company’s exposure to Italian bonds remained stable in absolute terms at €17.4 billion at the end of 2024, representing 1.5 times the group’s consolidated shareholders’ equity.
Unipol holds a leading position in Italy’s insurance market as the largest motor and health underwriter, with a strong presence in the life insurance sector. The company reported improved profitability, with its non-life combined ratio improving to 93.6% in 2024 from 98.2% in 2023, benefiting from lower natural catastrophe claims. In the first quarter of 2025, this ratio further improved to 91%, compared to 91.1% in the same period last year.
The company’s net income return on equity was 12% in 2024, down from 14% at the end of 2023 due to a higher equity base. Fitch expects Unipol’s underwriting and net profitability to remain strong in 2025.
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