The ratings on Dutch insurer Fortis Corporate Insurance N.V. (FCI) reflect its strong, albeit weakened, capitalization; good competitive position in its specialty markets; and good, though volatile, operating performance. Offsetting these is the uncertainty about the company's future ownership, strategy, and its concentrated exposure in the Benelux countries. The ratings do not include any explicit uplift from the current owner, the Dutch state, due to the temporary nature of this ownership. The state intends to sell FCI in the near term. Standard&Poor's Ratings Services views FCI's capitalization as strong, despite recent weakening, and underpinned by conservative claims reserving. However, substantial unrealized losses on corporate bonds weigh on FCI's risk-adjusted capital adequacy, which is currently only at good levels.
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