Insurance Hybrids

The Insurance Regulatory and Development Authority (IRDA) had allowed insurance companies to raise non-equity forms of capital such as subordinated debt or preference shares that would be eligible as capital for computation of the solvency margins of insurance companies.

 

Leveraging on its expertise in this sector, CRISIL Ratings developed a sound methodology and rated the first hybrid issuance by an Indian insurance company in April 2016.

 

Our rating methodology for hybrid instruments issued by insurance companies takes into account the credit profile of insurers through Corporate Credit Ratings (CCR), and factors in the additional risks that these instruments carry on account of restriction on debt servicing. CCR also reflects an insurance company's ability to meet policyholder obligations.

 

Further, Ratings are assigned to subordinated debt of insurers. However, the ratings are not recommendations to purchase or discontinue a policy, contract, or security issued by an insurance company, nor are they guarantees of financial strength.

 

CRISIL Ratings' rating methodology for life and non-life insurance companies entails assessing the companies on a standalone basis, as well as assessing the level of parent/government support that they receive.


We evaluate a company on the following criteria:

  • Industry risk and business risks across segments
  • Financials
  • Risk management systems
  • Goals and strategies and projected business plan
  • Parental support

Questions?

  • To get a copy of rating reports, please email us at:
    crisilratingdesk@crisil.com

  • For analytical queries, please email us at:
    ratingsinvestordesk@crisil.com

  • For any other information,  please call or email us at:
    +1800 267 1301
    crisilratingdesk@crisil.com