AM Best Revises Outlooks to Positive for JSC Insurance Company Aldagi Group
2024年7月3日 - 11:51PM
ビジネスワイヤ(英語)
AM Best has revised the outlooks to positive from stable
and affirmed the Financial Strength Rating of B (Fair) and the
Long-Term Issuer Credit Rating of “bb+” (Fair) of JSC Insurance
Company Aldagi Group (Aldagi) (Georgia).
The Credit Ratings (ratings) reflect Aldagi’s balance sheet
strength, which AM Best assesses as strong, as well as its strong
operating performance, limited business profile and marginal
enterprise risk management.
The revision of the outlooks to positive from stable reflect the
improvement of Aldagi’s balance sheet strength fundamentals and the
enhanced financial stability of the company’s ultimate parent,
Georgia Capital PLC. AM Best expects that Aldagi will maintain its
risk-adjusted capitalisation comfortably at the strongest level, as
measured by Best’s Capital Adequacy Ratio (BCAR), supported by
prudent capital and underwriting management. Furthermore, the risk
of material capital extractions due to Aldagi’s association with
its ultimate parent, has been reduced as the latter has improved
its financial stability.
Aldagi’s balance sheet strength is underpinned by its
risk-adjusted capitalisation at the strongest level, as measured by
BCAR. The assessment also considers Aldagi’s liquid investment
portfolio and moderate dependence on reinsurance, with its
reinsurance panel consisting of international companies of high
financial strength. Offsetting factors include the company’s
onerous dividend policy, which limits the internal capital
generation, as well as Aldagi’s exposure to the moderate political
and high economic and financial system risks in Georgia.
Aldagi has a track record of strong operating performance and in
2023 (under IFRS 17), generated a return-on-equity ratio of 23.6%
and a net-net non-life combined ratio of 95.4% (both as calculated
by AM Best). Underwriting results have benefited from Aldagi’s
prudent approach to risk selection and focus on profitability over
top-line growth. In 2023, the company reported insurance service
result of GEL 37.7 million (approximately USD 14.4 million) (2022:
GEL 41.0 million, approximately USD 14.1 million). Aldagi’s net
investment returns contribute positively to its operating
profitability but have been somewhat volatile over the recent years
owing to the high interest rate environment in Georgia and
internationally, as well as movements in the fair value of invested
assets.
Aldagi is one of the largest insurance companies in Georgia,
with a market share of approximately 17%, based on 2023 combined
non-life and life market premiums. The company benefits from its
strong brand and multichannel distribution network. Nevertheless,
Aldagi’s business profile is constrained by its geographical
concentration and the small size of its portfolio by international
standards. In 2023, the company reported insurance revenue of GEL
160.4 million (approximately USD 60 million). Aldagi’s top line is
expected to grow in the medium term as the company starts to
participate in the local compulsory motor third-party liability
insurance pool, as well as write facultative reinsurance business
domestically and in regional foreign markets. AM Best will continue
to monitor the progress of the company’s growth strategy.
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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Todor Kitin, ACA Senior Financial Analyst +44
20 7397 0335 todor.kitin@ambest.com
Christopher Sharkey Associate Director, Public
Relations +1 908 882 2310
christopher.sharkey@ambest.com
Jessica Botelho-Young, CA Associate Director
+44 20 7397 0310 jessica.botelho-young@ambest.com
Al Slavin Senior Public Relations Specialist +1
908 882 2318 al.slavin@ambest.com