S&P ups Aon outlook to positive

Standard & Poor's said it revised its outlook on Aon Corp. to positive from stable and affirmed its BBB+ counterparty credit and senior unsecured debt ratings.

The outlook was revised to reflect S&P's increased confidence that Aon will continue to improve its operating performance to a strong level through the continuation of its expense reduction initiatives and increased success in leveraging its competitive position in the risk and insurance broker segment.

The revised outlook also reflects the materially reduced potential, borne from recent regulatory and private party settlements and the passage of time, that ongoing regulatory investigations could trigger allegations that would materially impact Aon's competitive or financial condition, the agency said.

S&P said the ratings on Aon are supported by the company's strong competitive position led by the very strongly positioned risk and insurance broker segment and supplemented by the strongly positioned individual supplemental accident, health and disability insurance market and employee benefit line of business.

S&P said these factors are offset by the company's operating performance and financial profile, which has only recently improved to a level appropriate for the rating level. Ongoing competitive and financial uncertainties resulting from the allegations of fraud and anticompetitive actions disclosed in the settlement with various legal entities, though materially diminished, continue to represent a potential negative to the rating.

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