AM Best Revises Issuer Credit Rating Outlook to Positive for Shinkong Insurance Company Limited
2024年4月25日 - 10:41PM
ビジネスワイヤ(英語)
AM Best has revised the outlook to positive from stable
for the Long-Term Issuer Credit Rating (Long-Term ICR) and affirmed
the Financial Strength Rating (FSR) of A (Excellent) and the
Long-Term ICR of “a” (Excellent) of Shinkong Insurance Company
Limited (Shinkong Insurance) (Taiwan). The outlook of the FSR is
stable.
The Credit Ratings (ratings) reflect Shinkong Insurance’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).
The positive Long-Term ICR outlook reflects Shinkong Insurance’s
consistently profitable operating performance amid a challenging
operating environment over the past few years, partially attributed
to the COVID-19 pandemic and capital market volatility. The company
has benefitted from its prudent underwriting strategy, favourable
claims experience and disciplined expense management.
Pandemic-related insurance losses were limited. Shinkong Insurance
also reported improved investment results in 2023 as interest and
dividend income remained stable, while capital losses also shrank
materially during the year. Overall, the company’s underwriting
profitability and return on equity have consistently outperformed
the industry average over the past five years.
Shinkong Insurance’s risk-adjusted capitalisation remains at the
strongest level, as measured by Best’s Capital Adequacy Ratio
(BCAR). The company’s capital and surplus recorded double-digit
growth in 2023, mainly driven by positive operating results,
despite being partially offset by a dividend payment. Shinkong
Insurance’s investment portfolio has been liquid and stable with
the majority of these assets held in cash and investment grade
bonds. The company’s reinsurance dependency remains moderate and is
placed with reinsurer panels of good credit quality. The company’s
risk-based capital ratio remains at a healthy level.
Shinkong Insurance is the third-largest insurer in Taiwan’s
non-life insurance market based on gross premiums written. The
company’s underwriting portfolio has been moderately diversified
with a majority of its business in motor. The company’s
distribution channel mix remains stable with its direct channel
continuing to be the largest contributor. As for its
pandemic-related insurance product, Shinkong Insurance has
demonstrated prudent ERM practices on product development and a
high level of control in product distribution.
Positive rating actions could occur if Shinkong Insurance
maintains its competitive strength and better operating
profitability against its peers, while maintaining a very strong
balance sheet strength assessment. Negative rating actions could
occur if there is a substantial decline in the company’s
risk-adjusted capitalisation.
Ratings are communicated to rated entities prior to
publication. Unless stated otherwise, the ratings were not amended
subsequent to that communication.
This press release relates to Credit Ratings that have been
published on AM Best’s website. For all rating information relating
to the release and pertinent disclosures, including details of the
office responsible for issuing each of the individual ratings
referenced in this release, please see AM Best’s Recent Rating
Activity web page. For additional information regarding the use and
limitations of Credit Rating opinions, please view Guide to Best’s
Credit Ratings. For information on the proper use of Best’s Credit
Ratings, Best’s Performance Assessments, Best’s Preliminary Credit
Assessments and AM Best press releases, please view Guide to
Proper Use of Best’s Ratings & Assessments.
AM Best is a global credit rating agency, news publisher and
data analytics provider specialising in the insurance industry.
Headquartered in the United States, the company does business in
over 100 countries with regional offices in London, Amsterdam,
Dubai, Hong Kong, Singapore and Mexico City. For more information,
visit www.ambest.com.
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Madison Fan Financial Analyst +852 2827 3416
madison.fan@ambest.com James Chan Director, Analytics +852 2827
3418 james.chan@ambest.com Christopher Sharkey Associate
Director, Public Relations +1 908 882 2310
christopher.sharkey@ambest.com Al Slavin Senior Public Relations
Specialist +1 908 882 2318 al.slavin@ambest.com