SINGAPORE--(BUSINESS WIRE)--A.M. Best has affirmed the financial strength rating of A- (Excellent) and the issuer credit rating of “a-” of nib nz limited (nib nz) (New Zealand). The outlook for each rating remains stable.
The rating affirmations mainly reflect nib nz’s adequate balance sheet strength and continued favorable operating performance. The ratings also take into consideration the company’s strong risk management practices, which partially have contributed to stable and favorable claims experience over the past five years.
As of June 30, 2016, nib nz maintained a regulatory solvency ratio that was comfortably higher than the local requirement. In addition, the company’s risk-based capitalization is strong, underpinned by its low product risk profile, moderate underwriting leverage and conservative investment mix.
Over the past five years, nib nz’s operating performance has been favorable, with a five-year operating ratio of 91%. Additionally, combined and operating ratios generally were better and less volatile than other health insurers operating in New Zealand.
While positive rating actions are unlikely, negative rating actions may occur if incorrect underwriting decisions and inadequate product pricing lead to underwriting losses. Additionally, the ratings could be downgraded if there is material deterioration in the consolidated financial condition of nib nz’s ultimate parent, arising from impairment of goodwill or underwriting losses.
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 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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