Indonesia’s Asuransi Astra Receives Ratings Action From AM Best

KUALA LUMPUR, March 15 (Bernama) -- Global credit rating agency, AM Best has affirmed Indonesia’s PT Asuransi Astra Buana (Asuransi Astra) financial strength rating of A- (Excellent) and the long-term issuer credit rating of “a-” (Excellent) with a stable outlook on these credit ratings (ratings).

Concurrently, AM Best has assigned the Indonesia National Scale Rating (NSR) of aaa.ID (Exceptional) to Asuransi Astra with a stable outlook.

The ratings reflect Asuransi Astra’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.

The credit rating agency in a statement said the ratings also factor in a neutral impact from Asuransi Astra’s ultimate parent, Jardine Matheson Holdings Limited (Bermuda).

Asuransi Astra’s balance sheet strength is underpinned by its risk-adjusted capitalisation, which was at the strongest level at Dec 31, 2022, as measured by Best’s Capital Adequacy Ratio, and is expected to be maintained at this level prospectively.

The company’s capital adequacy is supported by its internal capital generation and low net underwriting leverage.

AM Best views Asuransi Astra’s investment portfolio to have moderate risk, comprising mainly bonds held directly and through mutual funds with more than half of those being domestically rated bond funds.

The company’s operating performance was also viewed as strong, demonstrated by its five-year average combined ratio of 88.1 per cent and return-on-equity ratio of 17.6 per cent (2019-2023), driven by profitable business from its parent group, PT Astra International Tbk (Astra group).

With its business profile assessed as neutral, Asuransi Astra is a large insurance organisation in Indonesia, ranking third in the country’s general insurance market based on 2022 market share.

-- BERNAMA