Standard and Poor’s has revised its outlook on nine Japanese insurers due to the March 11 earthquake and tsunami, while Moody’s says current loss estimates by two reinsurers are credit negative for that sector.

Despite its revised outlook to negative on some domestic insurers, S&P says it will likely not adjust ratings if current estimates on residential losses—currently at ¥1 trillion ($12.3 billion at the current exchange rate)—are not exceeded.

The New York-based rating service says “the current expectation” is that the actual loss will be below the estimated figure.

However, if losses exceed the ¥1 trillion mark, some insurers can expect downgrades of one notch.

S&P revised its outlook on:

• Mitsui Sumitomo Insurance Co. Ltd.

• Aioi Nissay Dowa Insurance Co. Ltd.

• Mitsui Sumitomo Kirameki Life Insurance Co. Ltd.

• Mitsui Sumitomo MetLife Insurance Co. Ltd.

• Sompo Japan Insurance Inc.

• NIPPONKOA Insurance Co. Ltd.

• Sompo Japan Himawari Life Insurance Co. Ltd.

• Kyoei Fire & Marine Insurance Co.

• Secom General Insurance Co.

S&P says it made the revision believing that the quake would “negatively affect the financial bases of the aforementioned insurers.”

S&P says it affirmed the ratings of and maintained a stable outlook on:

• Tokio Marine & Nichido Fire Insurance Co. Ltd.

• Tokio Marine & Nichido Life Insurance Co. Ltd.

• Nisshin Fire & Marine Insurance Co. Ltd.

• ACE Insurance

• Allianz Fire and Marine Insurance Japan Ltd.

• Toa Reinsurance Co.

Meanwhile, on the reinsurance side, Moody’s says early loss estimates of $1.2 billion by Swiss Re and $2.1 billion by Munich Re are credit negative for the reinsurance industry because they indicate that reinsurers will take the largest share—perhaps even more than half—of insured losses for the event.

“These figures highlight the importance of Japan’s insurance market to the global reinsurance industry, and vice versa,” Moody’s says in last week’s Weekly Credit Report. “For many years, reinsurers have sold some of the largest earthquake reinsurance protections in the world to Japan’s insurers, with notional liability in the tens of billions of U.S. dollars.”

Moody’s says the form of reinsurance coverage and the amount of total insured damages will determine how losses will be distributed among reinsurers.

Moody’s says industrywide loss estimates currently stand at between $12 billion and $30 billion.

Modeling firm AIR Worldwide recently narrowed its loss estimate to between $20 billion and $30 billion. The firm’s previous estimate was between $15 billion and $35 billion.