CHINA TAIPING INSURANCE (MACAU) CREDIT RATINGS AFFIRMED - AM BEST

KUALA LUMPUR, March 26 (Bernama) -- AM Best has affirmed the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Rating of ‘a’ of China Taiping Insurance (Macau) Co Ltd (CTIM) Macau, resulting in stable credit ratings outlook.

The ratings reflect CTIM’s balance sheet strength, which AM Best assesses as very strong, as well as its strong operating performance, neutral business profile and appropriate enterprise risk management.

CTIM’s balance sheet strength has improved to the very strong level, mainly driven by organic growth in the company’s capital and surplus through profit retention, as well as the settlement of large claims and reinsurance recoverables related to prior accident years.

According to a statement, the company’s risk-adjusted capitalisation, as measured by Best’s Capital Adequacy Ratio, is expected to remain at the strongest level over the medium term.

Its investment strategy remains conservative and focused on investing in low-risk fixed-income assets, including cash and bonds.

CTIM maintains a long track record as the leader in Macau’s non-life insurance segment, and has a market share of 33.4 per cent last year based on gross premium written.

Leveraging its strong relationships with corporate clients, in particular Chinese state owned-enterprises, the company’s underwriting portfolio and distribution channel remain stable and diversified, albeit its business is mainly concentrated in Macau.

Notwithstanding, AM Best views that the necessity of capital support from its parent company, China Taiping Insurance Holdings Company Limited has diminished in recent years, as CTIM’s capitalisation continues to grow organically and its risk adjusted capitalisation remains at a robust level.

CTIM is well-positioned at its current rating level; negative rating actions could occur if there is a material decline in the company’s risk-adjusted capitalisation or a significant and sustained deteriorating trend in its operating performance.

-- BERNAMA