A.M. Best Affirms Ratings of Hong Leong Insurance (Asia) Limited

HONG KONG--(BUSINESS WIRE)-- A.M. Best has affirmed the financial strength rating of A- (Excellent) and the issuer credit rating of “a-” of Hong Leong Insurance (Asia) Limited (HLIA) (Hong Kong). The outlook for both ratings is stable.

The rating affirmations reflect HLIA’s strong risk-adjusted capitalization and consistently favorable underwriting performance. Underwriting results have improved in recent years driven by profitable growth in personal lines and management initiatives to enhance cost efficiency. HLIA’s ratings also recognize its unique business feature of acquiring business through the direct distribution channel.

Partially offsetting these positive rating factors are HLIA’s exposure to investment risks and competitive market conditions in Hong Kong. HLIA has maintained a modest five-year average investment yield due to volatility in capital gains/losses over the past five years, which was largely driven by the company’s dynamic investment strategy. Acquisition of market share in Hong Kong’s non-life insurance market remains a challenge for HLIA.

Positive rating movement could occur if continued improvement in HLIA’s risk management strategy to mitigate its investment volatility and cost-efficiency management are materialized. Negative rating movement could occur if there is a material decline in the company’s risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio, due to substantial investment losses, or a larger than expected dividend payout.

Ratings are communicated to rated entities prior to publication, and unless stated otherwise, the ratings were not amended subsequent to that communication.

This press release relates to rating(s) that have been published on A.M. 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 A.M. Best’s Recent Rating Activity web page.

A.M. Best is the world’s oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com.

Copyright © 2016 by A.M. Best Company, Inc. and/or its affiliates. ALL RIGHTS RESERVED.

View source version on businesswire.com: http://www.businesswire.com/news/home/20160115005782/en/

A.M. Best
Ken Chow, +852-2827-3426
Senior Financial Analyst
[email protected]
or
Moungmo Lee, +65-6859-8412
Managing Director, Analytics
[email protected]
or
Christopher Sharkey, +(1) 908 439 2200, ext. 5159
Manager, Public Relations
[email protected]
or
Jim Peavy, +(1) 908 439 2200, ext. 5644
Assistant Vice President, Public Relations
[email protected]

Source: A.M. Best Company, Inc.

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