...Resilience, Competition Govern Outlook: Fitch Ratings believes the resilient market position, adequate capitalisation and external funding capabilities of the insurers we rate (see Appendix), will keep supporting their credit strength. Continued earnings volatility and fierce competition amongst insurers to sell their homogenous, savings-type products are key rating constraints. Higher Asset Risk: Chinese life insurers' credit profiles are more vulnerable to an economic downturn as they move more funds into alternative investments ¡ such as debt investment plans, trust schemes, and wealth-management products ¡ to improve yields. These types of investments are generally less liquid than straight bonds, and are focused on the infrastructure and real estate sectors. Equity exposures have also increased notably since late 2014, indicating greater vulnerability of their capitalisation to unfavourable stock-market movements. Capital Buffer Withstands Volatility: Chinese life insurers' strengthened...
