HONG KONG, Nov 3 (Bernama-BUSINESS WIRE) -- AM Best has affirmed the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Rating of “a” (Excellent) of KB Insurance Co., Ltd. (KBI) (South Korea). The outlook of these Credit Ratings (ratings) is stable.
The ratings reflect KBI’s balance sheet strength, which AM Best assesses 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 the very strong level, as measured by Best’s Capital Adequacy Ratio (BCAR). 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 KBI’s operating performance as adequate, with a weighted five-year average consolidated return-on-equity ratio of 9.0% (2018-2022) and an operating ratio of 96.4%. The company’s 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. KBI’s investment income continues to be a major source of earnings with a stable trend in its net investment returns.
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