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FOR IMMEDIATE RELEASE
HONG KONG - JULY 31, 2015 12:42 PM (EDT)
A.M. Best has affirmed the financial strength rating of A (Excellent) and the issuer credit rating of "a" of Central Reinsurance Corporation (Central Re) (Taiwan). The outlook for both ratings is stable.
The rating affirmations reflect Central Re's solid risk-adjusted capitalization, improved underwriting performance (excluding compulsory auto liability insurance (CALI) business) and its strong presence in the Taiwan reinsurance market.
Central Re has continued to maintain a solid risk-adjusted capitalization level, and its capital is expected to remain adequate to support business growth in the near term. The company's underwriting performance has stabilized since 2013, mainly due to the absence of severe catastrophe losses. The loss ratio of CALI business increased significantly in 2014, due to the one-off incurred but not reported reserve adjustment in the year, but it has no impact on Central Re's bottom line as the increased loss is completely offset by the release of CALI special reserves.
Partially offsetting factors include the limited growth opportunities in the domestic market and the challenges Central Re faces in overseas expansion given the current soft market conditions in the regional and global reinsurance market.
Ratings are communicated to rated entities prior to publication, and unless stated otherwise, the ratings were not amended subsequent to that communication.
This press release relates to rating(s) that have been published on A.M. Best's website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please visit A.M. Best's Ratings & Criteria Center.
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