Swiss insurer Youplus seeks new investors amid solvency ratio drop

Core Insights - Youplus Group is seeking additional capital due to a decline in its solvency ratio, which has fallen below an internally defined range [1][5] - The company has halted new business operations in several European markets as a precautionary measure [1] - Youplus Group reassures that its liquidity and solvency are not at risk, with all liabilities covered [2] Financial Situation - The company's solvency ratio dropped sharply to 107% by the end of 2024 from 286% in 2023 [5] - The financial challenges stem from a previously aggressive growth strategy initiated in 2023, which initially showed positive results but later revealed issues with fraudulent intermediaries [3][4] Strategic Response - Youplus Group is focusing on strengthening its capital base by seeking new qualified investors and engaging in de-risking activities [2] - The company is restructuring by pursuing partial sales of individual portfolios, optimizing internal processes, and introducing additional controls [2] Business Model Shift - Following the recognition of unsustainable new business submissions, Youplus Group has shifted its strategy to focus solely on managing existing policies and resolving related claims [4] - The company has ceased pursuing new contracts to mitigate risks associated with previous fraudulent business models [4] Market Context - The broader economic environment, particularly the downward trend in interest rates, has contributed to the company's challenges [5] - Youplus Group, founded in 2012, is part of a trend of private capital-backed businesses acquiring and managing legacy insurance portfolios [5][6]