AM Best Affirms Credit Ratings of Hyundai Marine & Fire Insurance Co., Ltd.
AM Best has affirmed the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Rating of "a" (Excellent) of Hyundai Marine & Fire Insurance Co., Ltd. (HMF) (South Korea). The outlook of these Credit Ratings (ratings) is stable.
The ratings reflect HMF's balance sheet strength, which AM Best assesses as strong, as well as its adequate operating performance, favourable business profile and appropriate enterprise risk management.
HMF's risk-adjusted capitalisation is assessed at the very strong level, as measured by Best's Capital Adequacy Ratio (BCAR). Despite considerable pressure on HMF's capital due to the valuation loss of available-for-sales securities from rising interest rates in 2022, AM Best expects the company's risk-adjusted capitalisation to remain supportive of the current balance sheet strength assessment and the capital sensitivity to interest rates movement to be largely resolved with the implementation of IFRS 17 in 2023. HMF's balance sheet assessment is also underpinned by its good financial flexibility, which was proven by a track record of successful issuance of hybrid and subordinated bonds over the last years, as well as a prudent investment strategy with a focus on asset-liability management.