AM Best affirms, withdraws credit ratings of Bangkok Insurance

KUALA LUMPUR: AM Best has affirmed Thailand-based Bangkok Insurance Public Company Limited (BKI) Financial Strength Rating of B++ (Good) and the Long-Term Issuer Credit Rating of “bbb+” (Good).

AM Best said in a statement the outlook of these credit ratings (ratings) is stable.

Concurrently, AM Best has withdrawn these ratings as the company requested to no longer participate in AM Best’s interactive rating process.

The ratings reflect BKI’s balance sheet strength, which AM Best assessed as very strong, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management.

BKI’s balance sheet strength assessment of very strong is underpinned by its riskadjusted capitalisation, which was at the strongest level in 2021 and is expected to remain at least at the very strong level prospectively, as measured by Best’s Capital Adequacy Ratio.

AM Best viewed BKI’s operating performance as adequate, as evidenced by a five-year average return-onequity ratio of 6.7 per cent and a combined ratio of 91.5 per cent (2017 to 2021).

Notwithstanding this, the company reported underwriting losses in 2021 and for the first nine months of 2022 on account of a high frequency of Covid-19 claims pertaining to its lump-sum payment health product.

Although technical and operating performance for the first nine months of 2022 has been unfavourable, AM Best expected results to improve prospectively, particularly following the coverage expiry of the company’s lump-sum Covid-19 health policies in mid-2022.

The business profile assessment of neutral reflects the company’s position as Thailand’s third largest nonlife general insurer with an approximate 8.6 per cent market share based on direct premium written in 2021. — Bernama