KUALA LUMPUR, Aug 20 (Bernama) -- A.M. Best has affirmed the financial strength rating (FSR) of A++ (superior) and the long-term issuer credit ratings (long-term ICR) of ‘aa+’ of Tokio Marine & Nichido Fire Insurance Co Ltd (TMNF) Japan.
The ratings have been affirmed for the U.S. subsidiaries of TMNF including Tokio Marine America Insurance Company, Trans Pacific Insurance Company, TM Specialty Insurance Company and TNUS Insurance Company.
Also affirmed is the FSR of A+ (superior) and the long-term ICR of ‘aa-’ of Tokio Marine Pacific Insurance Limited (TMPI) Guam -- a wholly owned subsidiary of TMNF. The outlook of these ratings for both TMNF and TMPI are stable.
The ratings reflect TMNF’s balance sheet strength, which A.M. Best categorised as strongest, as well as its strong operating performance, very favorable business profile and very strong enterprise risk management (ERM), a statement said.
TMNF's balance sheet strength is due in part to its risk-adjusted capitalisation being at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR) which supported by a large adjusted capital base consists of reported capital, catastrophe loss reserves and price fluctuation reserves.
TMNF has continued to generate positive operating profits for fiscal-year 2018, underpinned by a solid underwriting margin within its domestic non-life business and a stable stream of interest and dividend income from its investment portfolio.
A.M. Best believes that TMNF’s strong franchise value, considerable scale and diversified operations will help it navigate challenging market conditions while enhancing its earnings stability over the medium to long term.
Meanwhile, the ratings of TMPI reflect its balance sheet strength, which A.M. Best also categorised as very strong, as well as its strong operating performance, neutral business profile and appropriate ERM due to wide range of support received from its parent, TMNF.
TMPI holds a very strong balance sheet consisting of high quality assets and a conservative investment portfolio. Capital and surplus grew steadily and organically in the past 10 years from consistently positive profit retention under a low operating expense structure.
Despite its relatively high underwriting leverage, TMPI maintains a low product risk profile, as the majority of the company’s revenue comes from short-tailed group accident and health (A&H) products with high-frequency and low-severity claims.
A.M. Best is a global rating agency and information provider with a unique focus on the insurance industry. More details at www.ambest.com.
Meanwhile, the ratings of TMPI reflect its balance sheet strength, which A.M. Best also categorised as very strong, as well as its strong operating performance, neutral business profile and appropriate ERM due to wide range of support received from its parent, TMNF.
TMPI holds a very strong balance sheet consisting of high quality assets and a conservative investment portfolio. Capital and surplus grew steadily and organically in the past 10 years from consistently positive profit retention under a low operating expense structure.
Despite its relatively high underwriting leverage, TMPI maintains a low product risk profile, as the majority of the company’s revenue comes from short-tailed group accident and health (A&H) products with high-frequency and low-severity claims.
A.M. Best is a global rating agency and information provider with a unique focus on the insurance industry. More details at www.ambest.com.
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