HONG KONG'S CHINA TAIPING INSURANCE RATINGS AFFIRMED EXCELLENT - AM BEST

KUALA LUMPUR, Dec 10 (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 Hong Kong's China Taiping Insurance (HK) Company Limited [CTPI(HK)].

The outlook of these credit ratings (ratings) is stable, reflecting the company’s balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management (ERM).

According to AM Best in a statement, the ratings also incorporate the rating enhancement that CTPI(HK) receives from its parent, China Taiping Insurance Holdings Company Limited (CTIH).

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As measured by Best’s Capital Adequacy Ratio, CTPI(HK)’s very strong balance sheet strength is underpinned by its risk-adjusted capitalisation, while its capital and surplus improved by 2.4 per cent to HKD 5.3 billion (US$679 million) in 2023 as evaluated under the HKFRS 17 accounting standard. (US$1=RM4.42)

The company has maintained a healthy regulatory solvency ratio under the Hong Kong risk-based capital framework, with a healthy buffer over the regulatory minimum, in addition to its invested assets allocation remained largely consistent in 2023 and during the first half of this year.

AM Best assesses CTPI(HK)’s operating performance as adequate and over the past decade, the company has stayed profitable with the exception of 2020, when its performance was dragged by a sizeable impairment loss from private funds.

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According to AM Best calculations, the company’s overall underwriting performance has been improving since 2019, with its IFRS 17 combined ratio remaining below 100 per cent last year. Its net investment income remains robust with a mid- single-digit investment yield not including gains or losses, owing to income-generating invested assets including bonds and investment properties.

A strategically important overseas operating subsidiary of China Taiping Insurance Group Ltd (TPG), CTPI(HK) plays a vital role in TPG’s footprint overseas and its strategy in the Greater Bay Area. 

The company is integrated into the group’s capital management and ERM while also receiving a series of implicit support from TPG, including brand recognition, investment, reinsurance and operations.

-- BERNAMA