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          Fitch revises Generali rating to A- from AA-, negative outlook

          Fitch revises Generali rating to A- from AA-, negative outlook, due to ongoing pressure from Italian sovereign debt

          Trieste – The rating agency Fitch performed an industry rating revision for Italian and Spanish insurers on the basis of the “ongoing pressure” from the respective State’s sovereign debt.

          Accordingly, Fitch changed Generali rating from AA- to A-, negative outlook.

          However, Fitch notes that “if the outlook for sovereign debt improves and stabilizes, it is likely that insurer ratings could be upgraded should their actual and pro-forma capital ratios also improve”.

          Please find below the original press release by Fitch.

          ***

          FITCH TAKES RATING ACTIONS ON ITALIAN AND SPANISH INSURERS

          Fitch Ratings-London-13 December 2011: Fitch Ratings has downgraded Assicurazioni Generali's Insurer Financial Strength (IFS) rating to 'A-' from 'AA-', Fondiaria-SAI's IFS rating to 'BB-' from 'BB+', Societa Reale Mutua di Assicurazioni's IFS to 'BBB+' from 'A-' and ITAS Mutua's IFS rating to 'BBB' from 'BBB+'. At the same time, Fitch has affirmed Mapfre SA's Issuer Default Rating (IDR) at 'A-'. These ratings actions also apply to the entities' core subsidiaries. The Outlooks are Negative. A full rating breakdown is at the end of this comment.

          The rating actions follow Fitch's assessment of the insurers' pro-forma capital adequacy amid challenging investment conditions, particularly in Italy and Spain, including ongoing pressure from heightened government bond yields. Fitch has undertaken a series of stress tests in Italy and Spain, and has concluded that some insurers' large investment concentrations in sovereign debt justify/require distinction relative to similarly rated peers. The potential for these concentrations to result in poor capital performance under extreme scenarios is a key driver of the rating actions.

          Current market price declines and recent pricing volatility of sovereign debt have already moderately weakened insurers' capital positions as assessed by the regulatory solvency margin and Fitch's own assessment of capital adequacy, albeit to varying degrees. Given significant market and fundamental uncertainties with regards to sovereign debt, the possibility of further deterioration in the capital market performance of sovereign debt could ultimately more materially impair the insurers' capital positions. The rating actions consequently reflect the degree of sensitivity of the insurers' capital adequacy to stress test assumptions over the credit quality of their holdings of Italian and Spanish government and bank debt.

          As part of its analysis, Fitch evaluated each insurers' fundamental attributes, including various degrees of leveraging of domestic government debt relative to capital. Fitch also evaluated the existing strength of capital, and its ability to absorb future losses.

          If the outlook for sovereign debt improves and stabilises, it is likely that insurer ratings could be upgraded should their actual and pro-forma capital ratios also improve.

          As the agency has previously indicated, Italian insurers may not be able to pass on most of the losses incurred from an unlikely default of Italian government debt (see "Fitch: Italian Insurers Cannot Pass On All Sovereign Losses", dated 9 November 2011 at www.fitchratings.com). In an extreme scenario of a sovereign default, the ability of insurers to pass losses on to policyholders would be significantly impaired, as the return on customer portfolios may be below the minimum guaranteed to policyholders. Insurers would be liable for any additional losses.

          The rating actions also reflect Fitch's view that the environment in Italy and Spain is highly challenging and rapidly changing, which means that operating profitability is likely to remain pressurised in the medium term. The agency has sharply revised down its near and medium-term growth forecasts for Italy as the economy has not recovered in line with expectations and the eurozone crisis could push Italy into recession. Fitch now expects the Italian economy to contract by 0.5% in 2012 followed by 0% growth in 2013. This could exert negative pressure on sales of insurance products in 2011 and 2012.

          However, underwriting profitability in the non-life segment continues to recover as pricing and claims experience improve. In addition, life insurers' credit profiles remain solid, with technical profitability and margins expected to hold up due to a better business mix.

          The rating actions are as follows:

          Assicurazioni Generali SpA:
          IFS Downgraded to 'A-' from 'AA-'; IDR Downgraded to 'BBB+' from 'A+'; Outlook Negative

          Generali (Schweiz) Holding AG:
          IDR Downgraded to 'BBB-' from 'A-'; Outlook Negative

          Generali Iard:
          IFS Downgraded to 'A-' from 'AA-'; Outlook Negative

          Generali Vie:
          IFS Downgraded to 'A-' from 'AA-'; Outlook Negative

          Generali Deutschland:
          IFS Downgraded to 'A-' from 'AA-'; Outlook Negative

          Generali Deutschland Pensionskasse AG:
          IFS Downgraded to 'A-' from 'AA-'; Outlook Negative

          Cosmos Versicherung AG:
          IFS Downgraded to 'A-' from 'AA-'; Outlook Negative

          Cosmos Lebensversicherungs-AG:
          IFS Downgraded to 'A-' from 'AA-'; Outlook Negative

          AachenMuenchener Lebensversicherung AG:
          IFS Downgraded to 'A-' from 'AA-'; Outlook Negative

          Generali Lebensversicherung AG:
          IFS Downgraded to 'A-' from 'AA-'; Outlook Negative

          AachenMuenchener Versicherung AG:
          IFS Downgraded to 'A-' from 'AA-'; Outlook Negative

          Generali Versicherung AG:
          IFS Downgraded to 'A-' from 'AA-'; Outlook Negative

          Central Krankenversicherung AG:
          IFS Downgraded to 'A-' from 'AA-'; Outlook Negative

          Generali Espana, SA
          IFS Downgraded to 'A-' from 'AA-'; Outlook Negative

          Generali Versicherung AG (Austria)
          IFS Downgraded to 'A-' from 'AA-'; Outlook Negative

          Generali's debt ratings are as follows:

          Senior unsecured:
          EUR1,500m 4.75% guaranteed notes due 12 May 2014: downgraded to 'BBB+' from 'A+'
          EUR500m 3.875% notes due 6 May 2015: downgraded to 'BBB+' from 'A+'
          EUR750m 4.875% notes due 11 November 2014: downgraded to 'BBB+' from 'A+'
          EUR1,750m 5.125% notes due 16 September 2024: downgraded to 'BBB+' from 'A+'

          Hybrid capital instruments/notes:
          EUR1,250m perpetual notes 5.479% until February 2017, thereafter Euribor plus 214bp: downgraded to 'BBB-' from 'A-'
          GBP495m perpetual notes 6.416% until February 2022, thereafter Libor plus 220bp: downgraded to 'BBB-' from 'A-'
          EUR1,275m perpetual notes 5.317% until June 2016, thereafter Euribor plus 210bp: downgraded to  'BBB-' from 'A-'
          GBP700m perpetual notes 6.214% until June 2016, thereafter Euribor plus 208bp: downgraded to 'BBB-' from 'A-'
          GBP350m perpetual notes 6.269% until June 2026, thereafter Euribor plus 235bp: downgraded to 'BBB-' from 'A-'

          Subordinated notes:
          EUR750m fixed-/floating-rate subordinated callable notes due on 20 Jul 2022: downgraded to 'BBB-' from 'A-'

          Mapfre Familiar
          IFS affirmed at 'A+', Outlook revised to Negative from Stable

          Mapfre Global Risks Cia De Seguros Y Reaseguos
          IFS affirmed at 'A+', Outlook revised to Negative from Stable

          Mapfre Vida SA De Seguros Y Reaseguros
          IFS affirmed at 'A+', Outlook revised to Negative from Stable

          Mapfre Re Compania De Reaseguros S.A
          IFS affirmed at 'A', Outlook revised to Negative from Stable

          Mapfre SA
          Long-term IDR affirmed at 'A-', Outlook revised to Negative from Stable
          EUR700m 5.91% subordinated debt due 2037 with step-up in 2017 affirmed at 'BBB-'

          MAPFRE U.S.A. Corp.:
          Long-term IDR affirmed at 'A-', Outlook revised to Negative from Stable
          USD300m 5.95% senior notes due February 26, 2013 affirmed at 'BBB+'

          Commerce Insurance Company
          IFS affirmed at 'A+', Outlook revised to Negative from Stable

          Citation Insurance Company
          IFS affirmed at 'A+', Outlook revised to Negative from Stable

          Commerce West Insurance Company
          IFS affirmed at 'A+', Outlook revised to Negative from Stable

          American Commerce Insurance Company
          IFS affirmed at 'A+', Outlook revised to Negative from Stable

          Societa Reale Mutua di Assicurazioni
          IFS downgraded to 'BBB+' from 'A-', Outlook revised to Negative from Stable

          Reale Seguros Generales
          IFS downgraded to 'BBB+' from 'A-', Outlook revised to Negative from Stable

          ITAS Mutua
          IFS downgraded to 'BBB' from 'BBB+', Outlook revised to Negative from Stable

          Fondiaria-SAI S.p.A.
          IFS downgraded to 'BB-' from 'BB+', Outlook Negative

          Milano Assicurazioni S.p.A.
          IFS downgraded to 'BB-' from 'BB+', Outlook Negative

          Contact:

          Primary Analyst for all companies
          Federico Faccio
          Senior Director
          +44 (0) 20 3530 1394
          Fitch Ratings Limited
          30 North Colonnade
          London E14 5GN

          Harish Gohil (Secondary Analyst for Assicurazioni Generali)
          Managing Director
          +44 (0) 20 3530 1257

          Marc-Philippe Juilliard (Secondary Analyst for Mapfre)
          Senior Director
          +33 1 44 29 91 37

          Clara Hughes (Secondary Analyst for Reale Mutua and Fondiaria-SAI)
          Senior Director
          +44 20 3530 1249
          Raffaele Carnevale (Secondary Analyst for ITAS Mutua)

          Senior Director
          +39 02 87 90 87 203

          Committee Chairperson
          Chris Waterman
          Managing Director
          +44 20 3530 1168

          Media Relations: Michelle James, London, Tel: +44 0203 530 1574, Email:
          Michelle.James@fitchratings.com.

          Additional information is available on www.fitchratings.com. The ratings of Assicurazioni Generali and its entities, and Societa Reale Mutua di Assicurazioni and ITAS Mutua were solicited by, or on behalf of, the issuer, and therefore, Fitch has been compensated for the provision of the ratings. The ratings of Fondiaria-SAI and Mapfre SA and their related entities were unsolicited and have been provided by Fitch as a service to investors.

          Applicable criteria "Insurance Rating Methodology" dated 22 September 2011 are available at www.fitchratings.com.

          Applicable Criteria and Related Research:
          Insurance Rating Methodology
          http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=651018

          ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK:
          HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE.

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