Hong kong: Global credit rating agency, AM Best, has revised its outlook on China’s ZhongAn Online P and C Insurance Co Ltd (ZhongAn) to positive from stable, while affirming the company’s financial strength rating of A- (Excellent) and its long-term issuer credit rating of ‘a-‘ (Excellent).
According to BERNAMA News Agency, AM Best stated that the credit ratings reflect ZhongAn’s very strong balance sheet strength, marginal operating performance, favourable business profile, and appropriate enterprise risk management. The revised outlook to positive acknowledges the company’s improving operating performance, highlighting ZhongAn’s return to profitability in 2023. The technology and banking segments of the company are projected to achieve breakeven in 2024 and mid-2025, respectively. Continued profitability is anticipated, driven by better underwriting and investment results, alongside increased earnings stability from non-insurance segments.
ZhongAn’s balance sheet strength is rated at the very strong level, underpinned by its robust risk-adjusted capitalisation, as measured by Best’s Capital Adequacy Ratio. The company’s capital and surplus increased to 21.6 billion Chinese yuan (US$2.95 billion) by the end of June 2025, bolstered by consistent profit retention. Capital is expected to grow by over 15 per cent following a new share issuance in July. ZhongAn’s investment strategy benefits from diversified and liquid portfolios, predominantly comprising fixed-income assets, and it enjoys strong financial flexibility as a publicly listed entity in Hong Kong.
AM Best commended ZhongAn’s favourable business profile, citing the insurer’s leadership in digital innovation. As China’s first online-only property and casualty insurer, ZhongAn has leveraged proprietary technology to issue high-volume digital policies across various product lines, including accident and health, shipping return, credit and guarantee, and motor insurance. The company’s domestic market share rose to 2.0 per cent in direct premiums written in 2024, ranking it eighth in China’s P and C insurance sector. Additionally, ZhongAn’s technology export business has expanded significantly, catering to clients in banking, insurance, and securities both within China and internationally.