Standard & Poor’s (S&P) has assigned a “stable” outlook to most global insurers despite intense competition holding down earnings.

The ratings agency says insurers are well positioned to ride out the tough conditions due to their “strong financial performance and sound capitalisation”.

The only exceptions to the favourable outlook are AIG and Aegon, which received negative ratings due to subprime issues.

Soft pricing among property and casualty lines is expected to drag down earnings growth, while S&P says any large acquisition by the global insurers is likely to increase the risk of a negative rating.