AM Best Affirms Superior Ratings Of South Korea's DB Insurance

KUALA LUMPUR, July 22 (Bernama) -- AM Best has affirmed the financial strength rating of A+ (Superior) and the long-term issuer credit rating of “aa-” (Superior) of South Korea-based DB Insurance Co Ltd (DBI), with a stable outlook.

In a statement, the global credit rating agency said the credit ratings (ratings) reflected DBI’s very strong balance sheet, strong operating performance, favourable business profile and appropriate enterprise risk management.

The company’s risk-adjusted capitalisation remains at the strongest level, as measured by Best’s Capital Adequacy Ratio, and is expected to remain resilient despite headwinds such as interest rate fluctuations.

This resilience is supported by DBI’s robust internal capital generation, sound asset-liability management and low reliance on supplementary capital securities such as hybrid bonds and subordinated debts.

Its underwriting performance continues to outperform domestic peers, supported by a relatively low combined ratio and stable investment income, and it is expected to benefit from steady growth in its contractual service margin, aided by a favourable new business margin in its long-term insurance segment.

The company’s auto insurance line is projected to remain profitable, while volatility in the general property and casualty segment, due to recent overseas natural catastrophes, is expected to be manageable following mitigation efforts.

DBI’s investment income, largely derived from stable interest returns on its fixed-income portfolio, continues to bolster its earnings.

The company holds a market share of approximately 19 per cent in South Korea’s non-life insurance sector, supported by a strong brand presence and a diversified portfolio spanning long-term, auto and general insurance.

Its business profile is further enhanced by its subsidiary, DB Life Insurance Co Ltd, and recent overseas expansion through the acquisition of two non-life insurers in Vietnam.

-- BERNAMA