Kuala lumpur: Global credit rating agency, AM Best has affirmed the financial strength rating of A (Excellent) and the long-term issuer credit ratings of ‘a’ (Excellent) of Hong Kong’s Taiping Reinsurance Company Limited (TPRe) and its wholly owned subsidiary, Taiping Reinsurance (China) Company Ltd (TPRe China). In a statement, AM Best said the outlook of these credit ratings remains stable, reflecting TPRe’s balance sheet strength, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management.
According to BERNAMA News Agency, the ratings also acknowledge the continued implicit and explicit support given by TPRe’s parent company, China Taiping Insurance Holdings Company Limited (CTIH), in terms of capital, investment, risk oversight and shared operational resources. TPRe’s risk-adjusted capitalisation remained at the strongest level at year-end 2024, as measured by Best’s Capital Adequacy Ratio, and is expected to be maintained at the current level over the short to intermediate term.
Notably, the company sponsored the issuance of Asia’s first dual-peril, dual-trigger catastrophe bond on Dec 31, 2024, enhancing its catastrophe risk management capabilities. TPRe reported a net profit of HK$957.4 million in 2024, delivering an 8.3 per cent return-on-equity ratio. The non-life insurance service results have moderately improved with a combined ratio of 92.7 per cent, as calculated by AM Best. (HK$100 = RM54.20)
The reinsurer has been increasing its asset allocation to investment-grade bonds while lowering its exposure to alternative assets. Although investment impairment losses of financial assets materially narrowed in 2024, they continue to weigh down on the results. Leveraging CTIH’s strong brand recognition, TPRe has established a solid presence across the Greater China region and maintains a leading position in the non-life reinsurance market in both Hong Kong and Macau.
The company continues to strategically diversify its business profile in mature markets while enhancing its underwriting capabilities in speciality lines. AM Best expects the parent company to provide timely financial support to TPRe when needed.