The ratings on Italy-based composite insurer Società Cattolica di Assicurazione (Cattolica) reflect its strong competitive position in the Italian insurance market, strong capitalization, and strong financial flexibility. Offsetting factors are the group's dependence on third-party distribution for over 55% of its total premiums and weakened operating performance in the property/casualty (P/C) business. Cattolica is the sixth-largest Italian insurer and benefits from a sound bancassurance strategy and well-recognized agency force for the distribution of life and P/C products, respectively. Diversification within life and P/C is good. Thanks to these competitive advantages, Cattolica reached a new strategic alliance with Banca Popolare di Vicenza ScpA (BPVi, A-/Stable/A-2) in January 2007, which partially offset the negative impact of the cancellation of its exclusive distribution
