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Insurers probed by US prosecutors over their private credit investments paid millions of dollars to a tiny credit-rating agency at the heart of concerns about the industry’s growing conflicts of interest.
Delaware Life and Clear Spring, two insurers majority owned by the billionaire investor Mark Walter, have together paid $8mn to Egan-Jones since 2024, according to filings reviewed by the FT.
Walter, who owns the LA Dodgers and Lakers and has a stake in Chelsea Football Club, has faced a wide-ranging probe into the private credit holdings of insurers he controls through his investment firm TWG Global.
Concerns have been mounting that some private investment groups that acquired life insurers over the past decade could be loading the insurers with risky debt, in some cases linked to other parts of their empire.
The insurers controlled by Walter reclassified billions of dollars in private credit holdings after probes by US prosecutors and the Securities and Exchange Commission, resulting in Delaware Life’s affiliated assets jumping from 3 per cent of its portfolio to 42 per cent.
A large portion of Delaware Life’s affiliated investments were rated by the small rating provider Egan-Jones, according to a person close to the insurer, even as other insurers have sought to distance themselves from Egan-Jones due to questions over the quality of its marks.
Egan-Jones has come under particular scrutiny for its role in supporting the rapid growth of private credit, with about 20 analysts churning out thousands of ratings. Some oversight bodies have suggested that insurers may have shopped for more lenient ratings to cut the capital they need to back riskier assets.
Of just four US life insurers that disclosed fees paid to Egan-Jones for rating services in 2025, according to S&P Global Data, three were linked to Walter: Delaware Life, Clear Spring and EquiTrust.
The insurers disclosed payments to Egan-Jones because they exceeded 25 per cent of their total payments to trade associations, service associations and statistical or rating bureaus during the year.
EquiTrust, which paid about $1mn to Egan-Jones last year, was previously owned by Guggenheim Partners, where Walter serves as chief executive.
In 2015, Guggenheim sold a majority stake in EquiTrust to basketball star Earvin “Magic” Johnson, who decades ago played on the Lakers team Walter now owns. Walter later sat on the board of EquiTrust, which is now owned by Amistad Financial Group.
Typically, issuers arrange ratings rather than investors such as insurers. Higher-rated assets attract lower capital charges for insurers.
“The payments were made in the ordinary course of business for valid ratings services provided. It is not unusual for an investor to engage a rating agency,” Egan-Jones said in a statement.
It added: “We believe ratings arranged by issuers typically present a greater conflict, because the issuer has an interest in a better rating, as it will lower the interest rate and make the bonds more marketable. In contrast, an investor has an interest in ensuring that their investments perform as intended.”
Delaware Life, Clear Spring, TWG and Walter declined to comment through spokespeople. EquiTrust did not respond to a request for comment.
