Standard and Poor’s (S&P) has affirmed its A+ insurer ratings for QBE, but the outlook remains negative as the insurer reviews its North American business.

“We have maintained the negative outlook on the ratings, reflecting some prospect for further adverse volatility in QBE’s North American operations and uncertainty over the extent of any additional reserve strengthening over the short term,” S&P credit analyst Mark Legge says.

Insurer financial strength ratings and issuer credit ratings were affirmed as A+ on QBE’s 11 core operating subsidiaries.

S&P says the insurer has a good competitive position thanks to strong commercial market share in Australia, where it is a price leader, and its position in the Lloyd’s market.

The affirmations are based on QBE’s very strong business risk profile, moderately strong financial profile and strong enterprise risk management.

Ratings could drop if the North American operations continue to make losses over the next year without the prospect of a prompt, substantial turnaround.

S&P says QBE’s recent operating performance has been poor but it is expected to improve this year and continue over the next few years.

“Our expectations are based on management initiatives, resulting in an anticipated rebound in earnings from QBE’s North American businesses, continued favourable performance of its Australian and New Zealand businesses, and solid results from its European business, despite a challenging pricing environment.”

Meanwhile, QBE has sold down its shareholding in Elders Ltd from 7.95% to 6% through a series of on-market trades.

The insurer began selling down from a 10.23% shareholding earlier this year.