Gothaer Insurance Group

The stable outlook reflects our view that the group will defend its strong competitive position in the German life, health, and P&C insurance market, in particular in the SME and commercial segment, along with resilient capitalization levels and robust underwriting profitability over the next 12-24 months, despite ongoing low interest rates. We are unlikely to lower the ratings over the next 12-24 months. However, we could do so if: The group's earnings are consistently weaker than our base-case assumptions, or if we see higher earnings volatility and the group underperforms peers in the German market; or We thought Gothaer could no longer maintain capital adequacy at the 'A' level, which could happen as a result of aggressive growth, higher investment

...Gothaer remains a key player in Germany, especially in the commercial and SME segment. In our opinion, the group's diversified distribution channels and business mix allows it to offer insurance product solutions across all business segments, thereby enabling it to become a leading insurance player for SME businesses in its domicile market of Germany. In addition, as part of its push toward digitization, Gothaer is the first insurer in the German market offering a joint platform for a company's life and health insurance business administration, distribution, and services, called "ePension." Capitalization will remain sound, supported by retained earnings and a conservative investment strategy. In our opinion, Gothaer's capital position will remain comfortably above the 'A' level, according to our risk-based capital model through 2021-2023. Our assumption is mainly supported by Gothaer's ability to post strong bottom-line results, likely about 75 million-85 million over 2021-2023, and the...

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