HONG KONG–(BUSINESS WIRE)–AM Greatest has affirmed the Monetary Power Ranking of A- (Wonderful) and the Lengthy-Time period Issuer Credit score Ranking of “a-” (Wonderful) of Macau Insurance coverage Firm Restricted (MIC) (Macau). The outlook of those Credit score Rankings (scores) is steady.
The scores mirror MIC’s stability sheet power, which AM Greatest assesses as very robust, in addition to its ample working efficiency, impartial enterprise profile and acceptable enterprise threat administration.
MIC’s stability sheet power continues to be supported by its risk-adjusted capitalisation, which remained on the strongest stage, as measured by Greatest’s Capital Adequacy Ratio (BCAR). The corporate’s capital and surplus continued to develop organically in 2021, supported by constructive working outcomes and full revenue retention, in addition to capital features from the corporate’s funding property. Though MIC’s strategic asset allocation displays an urge for food to spend money on fairness securities, which exposes its general earnings to fairness market volatilities, the draw back dangers are mitigated partially by the corporate’s important stage of surplus capital.
MIC continues to rank third in Macau’s non-life insurance coverage market, with a market share of 10.4% by way of gross premium written. The corporate’s underwriting portfolio remained reasonably diversified with main strains of enterprise in property, medical, workers’ compensation and motor. For fiscal yr 2021, regardless of a diminished premium base, which led to a contraction in internet underwriting revenue, the general internet mixed ratio remained at a wholesome 89%. Over the close to time period, MIC’s top-line efficiency might proceed to be affected by a variety of challenges externally, such because the financial slowdown in Macau and near-term uncertainties within the native gaming trade. However, AM Greatest expects the corporate to proceed with its marketing strategy to keep up underwriting profitability via increasing its extra worthwhile enterprise; tightening underwriting practices for unprofitable enterprise; actively managing claims prices; enhancing digital capabilities; and enhancing operational effectivity.
Optimistic score actions may happen if MIC demonstrates profitable implementation of its marketing strategy to attain sustained enchancment and stability in its working efficiency, whereas sustaining a strong stage of risk-adjusted capitalisation. Damaging score actions may happen if MIC’s working efficiency experiences a cloth deterioration on account of unfavourable funding outcomes or a considerably weaker underwriting efficiency. Damaging score actions additionally may come up if MIC’s enterprise profile displays a sustained diminishing pattern that materially deviates from its indicated plans.
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