Toronto-based credit rating agency DBRS Ltd. on Wednesday announced a proposed new rating methodology for insurance companies.

DBRS has released a draft of its new methodology for rating both life and property & casualty (P&C) insurers for a 30-day comment period, ending Nov. 19.

The draft consolidates its existing separate approaches to rating Canadian life and P&C insurers.

“Having a single methodology for these two industries provides a common foundation for analyzing insurance companies while still addressing the notable differences between them. Moreover, this common foundation can be used to rate multi-line insurers and address other types of insurance companies in the future,” the company says in a statement.

The new methodology aims to factor in the increased complexity of insurance risks and regulation; major shifts in competition throughout the financial services industry; the evolution of the regulatory environment, particularly regarding capital definitions; and the growing global reach of internationally-active insurance companies. It alsofollows the creait rating agency’s philosophy of “rating through the cycle”; and it incorporates a financial strength rating (FSR) scale that aims to capture the risk of non-payment for policyholders and credit counterparties.

Once it finalizes the new methodology, existing insurance company ratings may be changed, the firm notes.

DBRS says it expects to carry out an internal review once the public comment period is complete, likely by mid-December.