Press Release - MAY 02, 2019
AM Best Affirms Credit Ratings of National Life and General Insurance Company SAOG
FOR IMMEDIATE RELEASE
LONDON - MAY 02, 2019
The ratings reflect NLGIC’s balance sheet strength, which AM Best categorises as very strong, as well as its strong operating performance, limited business profile and appropriate enterprise risk management.
NLGIC’s balance sheet strength is underpinned by risk-adjusted capitalisation at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR), which benefits from a conservative investment strategy and a reinsurance panel of good credit quality. The balance sheet assessment also factors in the company’s good level of liquidity and the absence of financial leverage. Offsetting factors include the concentration of the company’s assets in Gulf Cooperation Council markets and its relatively high reinsurance dependence. The balance sheet strength assessment incorporates the AM Best’s assessment of economic, political and financial system risk in Oman and the United Arab Emirates (UAE).
The company’s strong operating performance, evidenced by a five-year (2014-2018) weighted average return on equity of 16%, has been driven by good underwriting results from its non-life portfolio (five-year weighted average combined ratio of 91%). Medical and motor business are the principal contributor to earnings, with performance supported by profits from the company’s group credit life business and stable albeit relatively modest investment income.
NLGIC has a concentrated underwriting portfolio, with medical business accounting for 80% of gross written premiums. The company is the leading medical underwriter in Oman and has a growing presence in the UAE. It is well-positioned to benefit from the expected introduction of mandatory medical programmes in Oman, with the anticipated increase in business likely to provide the company with additional scale.
This press release relates to Credit Ratings that have been published on AM 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 AM 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 AM Best press releases, please view Guide for Media - Proper Use of Best’s Credit Ratings and AM Best Rating Action Press Releases.
AM Best is a global rating agency and information provider with a unique focus on the insurance industry.