HONG KONG--(BUSINESS WIRE)--A.M. Best Co. has placed under review with negative implications the financial strength rating (FSR) of B++ (Good) and issuer credit rating (ICR) of “bbb” of Hanwha General Insurance Company Limited (Hanwha Insurance) (South Korea).
The under review status reflects the sharp increase in Hanwha Insurance’s credit risk associated with reinsurance recoverables due to the downgrade of the ratings of BEST RE (L) Limited (BEST RE) (Malaysia) on 18 December 2012.
Hanwha Insurance ceded premiums related to smartphone insurance to BEST RE, which continues to report a material deterioration in underwriting results. The ratings will remain under review pending further discussions between A.M. Best and Hanwha Insurance’s management regarding the risk-adjusted capitalization.
Best’s Credit Rating Methodology, which provides a comprehensive explanation of A.M. Best’s rating process and contains the different rating criteria employed in the rating process. Key criteria utilized include: “Understanding Universal BCAR”; “Evaluating Country Risk”; “Catastrophe Analysis in A.M. Best Ratings”; and “Risk Management and the Rating Process for Insurance Companies.” Best’s Credit Rating Methodology can be found at www.ambest.com/ratings/methodology.
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