Fitch upgrades Sompo Japan

Fitch Ratings said it upgraded Sompo Japan Insurance Inc.'s long-term issuer default rating to A+ from A.

The outlook is stable.

Fitch also said it upgraded the company's $1.4 billion 60-year step-up callable subordinated notes to A- from BBB+.

Sompo Japan is a core company of NKSJ Holdings, Inc., along with Nipponkoa Insurance Co., Ltd. and NKSJ Life Insurance, Inc.

The upgrade reflects Sompo Japan's strengthened capitalization and the overall improving underwriting fundamentals of NKSJ, mainly due to a recovery in NKSJ's domestic non-life business, as well as a steadily growing and profitable domestic life insurance business, Fitch said.

Sompo Japan will become by far the largest operating company in the group following the expected merger with Nipponkoa in September 2014, the agency said.

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