A.M. Best Co., a rating agency, said the deal reached in Washington D.C., to increase the United States' debt ceiling does not get rid of credit quality uncertainty and may have a poor effect on the life insurance industry.
During stress testing of insurers' financial strength, the agency said it considered downgrading.
"The luster of the U.S. Treasury securities as a virtually risk-free investment has been tarnished," A.M. Best said.
The agency said the ratings outlook for the life and annuity sector of the insurance industry is having a big effect, esepcially as economic weakness continues. A.M. Best said that it considered changing its rating outlook from stable to negative, and now that likelihood is elevated.
PropertyCasualty360's website said that as much as 25 percent of life insurance rating units could have seen ratings impacted. It's not certain how much this would affect the average person buying life insurance. Meanwhile, less than 2 percent of property and casualty rating units have seen impacts as a part of a stress test performed last month.