AM Best Affirms Credit Ratings of Quest Insurance Group Limited
- October 15, 2026 10:03 AM (EDT)
//BestWire// - AM Best has affirmed the Financial Strength Rating of B (Fair) and the Long-Term Issuer Credit Rating of “bb+” (Fair) of Quest Insurance Group Limited (Quest) (New Zealand). The outlook of these Credit Ratings (ratings) is stable.
The ratings reflect Quest’s balance sheet strength, which AM Best assesses as adequate, as well as its strong operating performance, limited business profile and marginal enterprise risk management (ERM). The ratings also factor in a neutral holding company impact from Quest’s immediate shareholder, Geneva Finance Limited and its ultimate majority shareholder, Federal Pacific Group Limited.
AM Best has revised Quest’s ERM to marginal from appropriate. This reflects AM Best’s view of the evolving nature of the company’s risk management framework and weaknesses noted in the company’s risk management capabilities relative to its risk profile. AM Best expects Quest to continue improving its risk management framework and capabilities to support its operational scale, however, these improvements may take time to embed and will need to be tested.
AM Best has revised Quest’s operating performance to strong from adequate, reflecting the company’s track record of strong and stable operating performance metrics over the past five years (fiscal years 2022–2026). This is supported by robust insurance service results and positive investment returns. In fiscal year 2026, the company reported a combined ratio (net/net, IFRS 17) of 86.0% and a return-on-equity ratio of 33.0%. Investment income remains a stable contributor to the company’s overall profits, with a reported net investment yield of 3.2% in fiscal year 2026.
Quest’s balance sheet strength assessment is underpinned by its risk-adjusted capitalisation, which was at the strong level as of fiscal year-end ended 31 March 2026, as measured by Best’s Capital Adequacy Ratio (BCAR). Prospectively, AM Best expects the company’s risk-adjusted capitalisation to remain at least at the strong level, supported by internal capital generation. The company’s prospective regulatory solvency position is expected to remain appropriate, supported by prudent capital management. Offsetting balance sheet strength factors include the company’s small absolute capital size of NZD 22.7 million as of fiscal year-end 2026, which increases the sensitivity of its capital adequacy to stress scenarios, such as outsized dividend payments or fluctuations in prospective performance.
Quest’s business profile assessment of limited reflects the company’s small market presence, geographic concentration and relatively niche product offering, largely as a provider of comprehensive vehicle insurance and mechanical breakdown insurance in New Zealand. The company’s operational scale has increased significantly over the past five years, driven mostly by its third-party distributor. Quest is viewed to have material reliance on its third-party distributor, with the related distribution channel contributing to over half of gross written premium in fiscal year 2026.
Ratings are communicated to rated entities prior to publication. Unless stated otherwise, the ratings were not amended subsequent to that communication.
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 Guide to Best’s Credit Ratings. For information on the proper use of Best’s Credit Ratings (BCR), Best’s Performance Assessments (PA), Best’s Preliminary Credit Assessments (PCA) and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.
AM Best is a global credit rating agency, news publisher and data analytics provider specializing in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City.