KUALA LUMPUR, April 15 (Bernama) -- AM Best has revised the outlooks to stable from negative and affirmed the Financial Strength Rating of B+ (Good) and the Long-Term Issuer Credit Rating of ‘bbb-’ of Tugu Insurance Company Limited (TIC) Hong Kong.
The Credit Ratings (ratings) reflect TIC’s balance sheet strength, which AM Best assessed as strong, as well as its marginal operating performance, limited business profile and marginal enterprise risk management.
Based on a statement, the revised outlooks reflect the strategic planning and reduced level of uncertainty over TIC’s capitalisation and business profile over the short to intermediate term.
As TIC has formulated a new business plan, AM Best believes that TIC will continue to be an operating company of PT Asuransi Tugu Pratama Indonesia Tbk, on a going concern basis over the short to medium term.
TIC’s strongest level of risk-adjusted capitalisation, as measured by Best’s Capital Adequacy Ratio, remained supportive of its balance sheet strength in 2019 and 2020.
However, the company’s capital and surplus exhibited volatility over the past five years, driven by revaluation gains and losses arising from its large yet concentrated investment in real estate.
TIC remains a small player in Hong Kong’s highly competitive and fragmented non-life market.
Going forward, TIC aims to diversify its product offerings in Hong Kong’s insurance market, including personal motor and property lines, by strengthening its distribution partnerships with brokers and agents.
AM Best expects the company to benefit from a more stable claims experience and improved management expense efficiency from a growing earned premium base.
-- BERNAMA
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