New Zealand’s Co-op Life Credit Ratings affirmed - AM Best

KUALA LUMPUR, Sept 25 -- Global credit rating agency, AM Best has affirmed the Financial Strength Rating of B++ (good) and the Long-Term Issuer Credit Rating of ‘bbb+’ of Co-operative Life Limited (Co-op Life) New Zealand.

The outlook of these Credit Ratings is stable, according to a statement.

The ratings reflect Co-op Life’s balance sheet strength, which AM Best categorises as adequate, as well as its strong operating performance, limited business profile and appropriate enterprise risk management.

In addition, the ratings factor in a neutral impact from the company’s ultimate ownership by The Co-operative Bank Limited.

Co-op Life’s balance sheet strength assessment is underpinned by its risk-adjusted capitalisation, as measured by Best’s Capital Adequacy Ratio, which remains at the strongest level as of fiscal year-end 2020.

The small-sized life insurer has a track record of strong operating performance, with the company having reported a five-year average return-on-equity ratio of 28.6 per cent (fiscal-years 2016-2020).

Profitability continues to be driven by the strong underwriting performance of its in-force life business, coupled with low single-digit but stable investment returns.

Prospectively, AM Best expects that the company’s steady revenue growth and robust pricing strategy, coupled with a stable stream of investment income, will help maintain strong operating performance over the medium term.

-- BERNAMA