Press Release - NOVEMBER 30, 2018

A.M. Best Affirms Credit Ratings of Zavarovalnica Triglav d.d. and Pozavarovalnica Triglav Re, d.d. Ljubljana


CONTACTS:
 Martina Seydoux
Financial Analyst
+44 20 7397 0308
martina.seydoux@ambest.com

Ghislain Le Cam, CFA, FRM
Director, Analytics
+44 20 7397 0268
ghislain.lecam@ambest.com

Christopher Sharkey
Manager, Public Relations
+1 908 439 2200, ext. 5159
christopher.sharkey@ambest.com

Jim Peavy
Director, Public Relations
+1 908 439 2200, ext. 5644
james.peavy@ambest.com

FOR IMMEDIATE RELEASE

LONDON - NOVEMBER 30, 2018
A.M. Best has affirmed the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Ratings of “a” of Zavarovalnica Triglav d.d. (Triglav), the operating holding company of the Triglav group, and Pozavarovalnica Triglav Re, d.d. Ljubljana (Triglav Re), a wholly owned subsidiary of Triglav. Both companies are domiciled in Slovenia. The outlook of these Credit Ratings (ratings) remains stable.

The ratings reflect Triglav’s balance sheet strength, which A.M. Best categorises as very strong, as well as its strong operating performance, neutral business profile and appropriate enterprise risk management (ERM). The ratings of Triglav Re factors in its strategic importance to Triglav, together with its strong integration into the group.

Triglav’s balance sheet strength is underpinned by its risk-adjusted capitalisation at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR). The assessment also considers the group’s good financial flexibility, with access to equity and debt markets, and prudent reserving approach for its non-life operations. Offsetting factors include the high average guarantees embedded within its life portfolio, which, combined with material asset-liability mismatch, exposes earnings and shareholders’ funds to adverse interest rate movements.

Triglav’s strong operating performance is evidenced by a solid five-year (2013-2017) average return on equity of 11%. Performance is driven by excellent non-life technical earnings in its domestic market, where the group’s dominant competitive position enables it to operate with a low expense base. Profitability of Triglav’s operations in the West Balkans has been weaker, impacted by intense competitive conditions and high operating costs. Nonetheless, the group continues to demonstrate modest improvement in earnings derived from this region, as it achieves additional scale and actively seeks alternative lower cost distribution channels.

Triglav benefits from its dominant position in its domestic market, with a 36% market share (in terms of gross written premiums) in 2017. The group is also a dominant player in the West Balkans. A.M. Best expects growth in premium volume to be moderate over the medium term, reflecting the combination of improving operating conditions in Slovenia, and the highly competitive nature of the international reinsurance market.

This press release relates to Credit Ratings 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 see A.M. Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Understanding Best’s Credit Ratings. For information on the proper media use of Best’s Credit Ratings and A.M. Best press releases, please view Guide for Media - Proper Use of Best’s Credit Ratings and A.M. Best Rating Action Press Releases.

A.M. Best is a global rating agency and information provider with a unique focus on the insurance industry.


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