Ratings agency Standard & Poor’s (S&P) has lifted Tower Australia’s insurer financial strength and counterparty credit ratings from A- to A.

The outlook on the life insurer’s ratings has also been revised to stable from positive.

S&P says the upgrade reflects Tower’s improved business and competitive position and its strong capital position.

Credit analyst Thomas Cherian says Tower’s performance in the life risk sector has remained “resilient” and S&P expects the company to “continue to leverage off the strong underlying fundamentals of the life risk sector as it improves scale and efficiency”.

Tower Australia MD Jim Minto says the ratings upgrade recognises the continued building and strengthening of the company.

“Tower has good competitive positions in its chosen life insurance market segments and is growing and performing well,” he said. “The company is positive about its future prospects.”