Best’s News & Research Service - January 21, 2016 02:38 PM (EST)
A.M. Best Withdraws Ratings of China Overseas Insurance Limited
Hong Kong //BestWire// - A.M. Best has revised the issuer credit rating (ICR) outlook to stable from positive and affirmed the financial strength rating (FSR) of B++ (Good) and the ICR of “bbb” of China Overseas Insurance Limited (COIL) (Hong Kong). The outlook for the FSR remains stable. Concurrently, A.M. Best has withdrawn the ratings in response to the company’s request to no longer participate in A.M. Best’s interactive rating process.
The rating actions reflect the decline in COIL’s risk-adjusted capitalization as a result of significant investment increases in a number of fellow subsidiaries of its parent, China State Construction International Holdings Limited (CSCIH), since 2014. Moreover, the company’s weakened risk-adjusted capitalization is exposed to greater potential underwriting and reserve volatilities stemming from the long-tailed nature of its core construction Employees’ Compensation business.
Notwithstanding, the negative rating factors are offset by COIL’s improved operating results since 2013, and continued business support from CSCIH, which is one of the largest construction companies in Hong Kong.
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 see A.M. Best’s Recent Rating Activity web page.
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