Fitch Rates Intact's Series 4 Preferred Shares 'BBB'

(The following statement was released by the rating agency)CHICAGO, September 22 (Fitch) Fitch Ratings has assigned a 'BBB' rating to Intact Financial Corporation's (Toronto: IFC) (Intact) Series 4 non-cumulative preferred shares. Fitch took no rating action on Intact's other ratings. A full list of ratings follows at the end of this release.KEY RATING DRIVERSIntact's recently announced that 1.6 million of it 10 million non-cumulative Rate Reset Class A Share Series 3 (Series 3 Preferred Shares) were tendered for conversion on Sept. 30, 2016. At that time, each share will be converted on a one-for-one basis into non-cumulative floating rate Class A Shares Series 4 (Series 4 Preferred Shares) of IFC.Subject to certain conditions described in IFC's prospectus supplement dated Aug. 11, 2011, IFC may redeem the Series 3 Preferred Shares, in whole or in part, on Sept. 30, 2021 and on Sept. 30 every five years thereafter and may redeem the Series 4 Preferred Shares, in whole or in part, after Sept. 30, 2016.This transaction will not have any impact on financial leverage and a minimal impact on fixed charge coverage given the lower rate of the Series 3 Preferred Shares.For further rationale on Intact's ratings see press release dated Aug. 31, 2016.RATING SENSITIVITIESKey rating triggers that could lead to a downgrade include:--A MCT below 170%;--Sustained adverse reserve development of more than 3% of prior year shareholder's equity;--A material acquisition outside of the Canadian insurance market;--Sustained GAAP fixed charge coverage ratio below 7.0x or financial leverage above 25%.Key rating triggers that could lead to an upgrade include:--Improvement in capital adequacy and leverage measures consistent with 'AA' sector credit factors;--Consistent and sustained financial performance with return on equity in the low to mid-teens;--Sustained favorable reserve trends;--Sustained financial leverage below 20%.FULL LIST OF RATING ACTIONSFitch has assigned the following rating: Intact Financial Corporation --CAD 40 million 3.172% non-cumulative class A series 4 preferred stock 'BBB'.Fitch currently rates Intact and its insurance subsidiaries as follows: Intact Financial Corporation --IDR 'A';--CAD 250 million unsecured senior debt 5.41% due Sept. 3, 2019 'A-';--CAD 300 million unsecured senior debt 4.70% due Aug. 18, 2021 'A-';--CAD250 million unsecured senior debt 3.77% due March 2, 2026 'A-';--CAD 250 million unsecured senior debt 6.40% due Nov. 23, 2039 'A-';--CAD 250 million unsecured senior debt 5.16% due June 16, 2042 'A-';--CAD 100 million unsecured senior debt 6.20% due July 8, 2061 'A-';--CAD 250 million 4.2% non-cumulative class A series 1 preferred stock 'BBB;'--CAD 210 million 4.2% non-cumulative class A series 3 preferred stock 'BBB'.The Rating Outlook is Stable.Intact Assurances Agricoles Inc. Intact Insurance CompanyJevco Insurance Company La Compagnie d'Assurances Belair Inc. Nordic Insurance Company of Canada Novex Insurance Company Trafalgar Insurance Company of Canada--Insurer Financial Strength 'AA-', Outlook Stable.Contact: Primary AnalystGerald B. Glombicki, CPADirector+1-312-606-2354Fitch Ratings, Inc.70 W. Madison Street Chicago, IL 60602 Secondary AnalystJames B. Auden, CFA Managing Director+1-312-368-3146Committee ChairpersonDonald F. Thorpe, CFA, CPASenior Director+1-312-606-2353Media Relations: Sandro Scenga, New York, Tel: +1 212-908-0278, Email: sandro.scenga@fitchratings.com.Date of Relevant Rating Committee: Aug. 30, 2016Additional information is available on www.fitchratings.comApplicable Criteria Insurance Rating Methodology - Effective May 17, 2016 to Sept. 15, 2016 (pub. 17 May 2016)https://www.fitchratings.com/site/re/881564Additional Disclosures Solicitation Status https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=1012077Endorsement Policy https://www.fitchratings.com/jsp/creditdesk/PolicyRegulation.faces?context=2&det ail=31ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.