KUALA LUMPUR, Nov 3 (Bernama) -- Global credit rating agency, AM Best has affirmed the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Rating of “a” (Excellent) of South Korea’s KB Insurance Co Ltd (KBI).
In a statement, AM Best said the credit ratings (ratings) which have a stable outlook, reflected KBI’s balance sheet strength, was assessed as strong, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management.
The ratings also reflect the support that the company receives from its parent, KB Financial Group Inc (KB Group) and its strategic importance to KB Group.
KBI’s risk-adjusted capitalisation has remained at a very strong level, as measured by Best’s Capital Adequacy Ratio, in which the company exhibited good accessibility to the capital market through the recent issuances of subordinated bonds.
Other balance sheet strength considerations include KBI’s relatively low debt leverage and healthy coverage ratios, as well as its conservative investment strategy.
AM Best assesses the company’s operating performance as adequate, with a weighted five-year average consolidated return-on-equity ratio of 9.0 per cent (2018-2022) and an operating ratio of 96.4 per cent.
Its underwriting profitability improved materially in 2022, mainly driven by favourable long-term line performance as a result of decreased medical indemnity loss ratio due to several rounds of rate hikes and stabilised medical claims.
In addition, KBI’s investment income continues to be a major source of earnings with a stable trend in its net investment returns.
As a wholly owned subsidiary of KB Group, one of the largest financial holding companies in South Korea, KBI remained the fourth-largest non-life insurer in South Korea with a stable market share of approximately 13 per cent, based on gross premiums written in 2022.
-- BERNAMA
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