[ad_1]
Get instant alerts when breaking news about your stock. Claim your 1 week free trial Street Insider Premium here.
HONG KONG–(BUSINESS WIRE)–(BUSINESS WIRE)–
AM Best has affirmed Tokio Marine Pacific Insurance Limited (TMPI), Guam’s financial rating of A+ (Superior) and long-term issuer credit rating of ‘aa-‘ (Superior). The outlook for these credit ratings is stable.
The ratings reflect the strength of TMPI’s balance sheet, which AM Best assesses as very strong, adequate operating results, a neutral business profile and adequate corporate risk management. The rating also acknowledges the broad implicit and explicit support TMPI receives from Tokio Marine Holdings (TMH)’s primary insurance entity, Tokio Marine & Nichido Fire Insurance Co., Ltd. (TMNF).
AM Best rates TMPI’s risk-adjusted capital at the highest level, as measured by Best’s Capital Adequacy Ratio (BCAR). Although capital growth has slowed due to higher dividend payments in recent years, AM Best expects the company’s risk-adjusted capital to remain at its strongest level over the medium term. Our assessment of balance sheet strength also takes into account a highly conservative investment strategy and a low reliance on reinsurance.
TMPI’s focus on the accident and health (A&H) segment and market competition has led to a track record of good and consistent performance overall, although underwriting margins remain thin. The company reported strong earnings in 2020 and 2021. This is due to a decline in medical and auto claims amid the COVID-19 pandemic and various underwriting initiatives. However, its underwriting margins deteriorated in the first half of 2022 as medical claims recovered after the pandemic, coupled with its re-entry into the Government of Guam Health Plan (GovGuam) for the 2022 renewal period. AM Best hopes that the company’s success in raising interest rates in its A&H business unit throughout 2022 will help stabilize loss ratios going forward, but AM Best also expects ongoing medical inflation and motor vehicle losses to continue to rise. We also note potential pressure from further normalization of rates to previous levels. -COVID level.
TMPI is a wholly owned subsidiary of Tokio Marine North America and ultimately owned by TMH, one of Japan’s largest non-life insurance groups. The company has a strong presence in Guam’s property and casualty insurance industry, supported by a dominant position in the A&H segment. Despite a significant decline in premium base due to non-renewal of GovGuam accounts in 2020 and 2021, the company’s premium base has benefited from a large number of business and federal employees from commercial A&H accounts. remained supported by their health plan. It has grown steadily over the past few years due to business diversification.
The company receives extensive implicit and explicit support from the Group in terms of brand recognition, management expertise, operations, capital and reinsurance.
A sustained and significant deterioration in TMPI’s performance could lead to a downgrade of the rating. If risk-adjusted capital declines significantly, for example if capital requirements increase significantly while earnings retention remains low, or to the extent that support from the TMNF no longer supports the current level of enhancement. A decrease may also result in negative rating action.
AM Best continues to be the leading rating agency for alternative risk transfer entities, with over 200 such vehicles rated worldwide. For current Best credit ratings and independent data on the captive and alternative risk transfer insurance market, please visit: www.ambest.com/captive.
Ratings are communicated to the rated entity prior to issuance.Unless otherwise noted, the evaluation is After that communication it was not fixed.
This press release relates to credit ratings posted on AM Best’s website. For all rating information related to the release and related disclosures, including details of the office responsible for issuing the individual ratings referenced in this release, please see AM Best’s Recent Ratings Activity web page. please give me. For additional information on the use and limitations of credit rating opinions, please see our best credit rating guide. For information on proper use of Best’s Credit Ratings, Best’s Performance Assessments, Best’s Preliminary Credit Assessments, and AM Best Press Releases, please see our Guide to Proper Use of Best’s Ratings & Assessments.
AM Best is a global credit rating agency, news publisher and data analytics provider dedicated to the insurance industry. Headquartered in the United States, with offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City, we operate in over 100 countries. For more information, please visit www.ambest.com.
Copyright © 2022 AM Best Rating Services, Inc. and/or its affiliates. all rights reserved.
View source version at businesswire.com: https://www.businesswire.com/news/home/20221020005827/en/
Lee Chan Young
Associate Director, Analytics
+852 2827 3404
[email protected]
Jason Shum
Associate Director, Analytics
+852 2827 3424
[email protected]
Christopher Sharkey
manager, public relations
+1 908 439 2200, ext. 5159
[email protected]
Al Slavin
communication specialist
+1 908 439 2200, ext. 5098
[email protected]
Source: AM Best
[ad_2]
Source link
