Eight months after lowering its outlook for the US life insurance industry, ratings agency Moody’s has again served up more gloom. Moody’s Investors Service says its rating outlook for the US life insurance industry continues to be negative. “Persistent negative credit trends” will put increased strain on the industry’s earnings and capital formation until at least mid-2004.

Three years of equity losses and credit losses in investment portfolios have had a “pronounced effect” on some life insurers’ annuity fees and guarantees, many of which were set investment market boom of the early-90s.

Moody’s says the credit profiles of US life insurers “will continue to be driven by economic, demographic, and competitive trends”.