Hong kong: Global credit rating agency, AM Best, has assigned a financial strength rating of A- (Excellent) and a long-term issuer credit rating of 'a-' (Excellent) to Hong Kong's SAIC Motor Insurance Limited (SAIC Captive). The outlook for these credit ratings is stable, reflecting SAIC Captive's balance sheet strength, assessed by AM Best as very strong, along with its adequate operating performance, neutral business profile, and enterprise risk management.
According to BERNAMA News Agency, SAIC Captive was established in 2025 as a single-parent captive of SAIC Motor Corporation Limited (SAIC Motor), China's largest state-owned motor manufacturer. SAIC Captive serves as the dedicated risk management and insurance arm of SAIC Motor. SAIC Motor is primarily owned by Shanghai Automotive Industry (Group) Co Ltd (SAIC Group), which is wholly owned by the Shanghai municipal government.
During its start-up phase, SAIC Captive is focused on underwriting individual motor liabilities for vehicles produced by SAIC Motor. This includes motor extended warranty, product replacement coverage, and expense reimbursement insurance, while carefully managing group-related commercial risks.
AM Best has indicated that SAIC Captive's strong balance sheet assessment is due to its initial capital of US$49 million and risk-adjusted capitalisation, as measured by Best's Capital Adequacy Ratio. This is expected to remain at the strongest level under its initial five-year plan from 2026 to 2030. Factors contributing to this assessment include low underwriting leverage, a prudent investment portfolio, strong liquidity, and appropriate reinsurance arrangements.
SAIC Captive anticipates moderate underwriting losses in its early years due to start-up expenses but expects to achieve a turnaround within the first five years of operation. The company projects its bottom line will be largely supported by investment income, aiming for an average mid- to low-single-digit return on capital and surplus over the next five years.
AM Best noted that SAIC Captive's operational and business execution risks are manageable and are partly mitigated by the company's management experience, underwriting expertise, and accumulated data from its key business lines.