AM BEST AFFIRMS SOUTH KOREA’S HANWHA GENERAL INSURANCE CREDIT RATINGS

KUALA LUMPUR, July 28 (Bernama) -- Global credit rating agency, AM Best has affirmed South Korea’s Hanwha General Insurance Company Limited (HGI) financial strength rating of A (Excellent) and the long-term issuer credit rating of “a” (Excellent), with a stable outlook.

These credit ratings (ratings) reflected HGI’s strong balance sheet, anchored by adequate operating performance, a neutral business profile, and appropriate enterprise risk management, as well as support from parent company, Hanwha Life Insurance Co Ltd (Hanwha Life).

In a statement, AM Best said HGI’s risk-adjusted capitalisation, as measured by its Capital Adequacy Ratio, is assessed at the strongest level.

Despite a moderate dip in capital and surplus at the end of 2024—linked to lower interest rates and regulatory discount changes—AM Best noted HGI’s effective mitigation efforts. These included issuing subordinated bonds and using reinsurance, measures viewed as supportive despite a rise in debt leverage.

Operating performance remained solid, with a 10 per cent return on equity and a combined ratio of 94.2 per cent under IFRS 17. Improved profitability from legacy medical policies and strong investment returns contributed to the stable financial results.

Ranked sixth in South Korea’s non-life sector, HGI controls around six per cent of the market and is pushing deeper into long-term insurance through key distribution channels, including Hanwha Life Financial Services, which is the sales-specialised subsidiary of Hanwha Life.

AM Best’s ratings also reflect the ongoing capital, operational, and distribution support from Hanwha Life, South Korea’s second-largest life insurer—highlighting strong group integration and brand synergy.

Future rating upgrades hinge on sustained capital strength across both HGI and Hanwha Life. Conversely, a downgrade could follow reduced support from Hanwha Life or deterioration in its own financial standing.

-- BERNAMA