Kuala lumpur: AM Best’s benchmarking analysis reveals that Asia-Pacific (APAC) insurance stability is largely underpinned by mature markets, which continue to support rating strength and capital adequacy in the region. This resilience is further reinforced by emerging markets maintaining growth and profitability despite experiencing greater volatility.

According to BERNAMA News Agency, a new Best’s Special Report titled “Asia-Pacific Benchmarking: Stability Anchored by Mature Markets” provides insights into the structural resilience observed across AM Best’s rated (re)insurance groups in Asia and Oceania. The report highlights that rating stability is prevalent across the region, with 14 long-term issuer credit rating upgrades and no downgrades recorded in 2024.

AM Best senior industry analyst, David Lopes, emphasized the importance of balance sheet resilience, stating that it remains the cornerstone of rating strength in the APAC region. Lopes noted that approximately 60% of rated insurers are categorized within the top two strength levels – strongest or very strong – indicating sound capitalisation and prudent asset management.

From an operational standpoint, insurers with more favorable assessments demonstrate better combined ratios and lower volatility compared to those with less favorable assessments. The report also highlights that insurers in mature markets enjoy higher shares of favorable business profile assessments due to data and product sophistication, established distribution channels, and diversified operations.

Conversely, insurers in smaller emerging markets, while showing improvement, still encounter challenges related to scale, diversification, and regulatory consistency. AM Best, headquartered in the United States, is a global credit rating agency and data analytics provider specializing in the insurance industry, with operations in over 100 countries and regional offices in cities such as London, Amsterdam, Dubai, Hong Kong, Singapore, and Mexico City.