AM Best Maintains Under Review With Positive Implications Status for Credit Ratings of Century Insurance Company (Guam) Limited

HONG KONG--(BUSINESS WIRE)--AM Best has maintained the under review with positive implications status for the Financial Strength Rating of B++ (Good) and the Long-Term Issuer Credit Rating of “bbb+” of Century Insurance Company (Guam) Limited (CIC Guam) (Guam).

These Credit Ratings (ratings) were initially placed under review on 3 July 2019, following an announcement that DB Insurance Co., Ltd. (DBI) entered into an agreement with CIC Guam’s parent company, Tan Holdings Corporation (THC), to acquire an 80% stake in each of THC’s three insurance subsidiaries, including CIC Guam and two other insurers in Saipan and Papua New Guinea. DBI also was expected to secure the management rights in all three companies. At that time, AM Best indicated that the ratings would remain under review until the transaction was completed, and an assessment of the subsequent impact to CIC Guam’s business profile and other credit fundamentals could be determined.

Based on AM Best’s recent conversations with company management, THC and DBI remain in close contact on this transaction. Currently, there is no clear date for closing; however, CIC Guam does continue to operate unencumbered by this ongoing development. Despite a continued contraction in premium volume for the nine-month period that ended Sept. 30, 2020, which led to further increase in underwriting expense ratio, CIC Guam’s combined ratio decreased significantly to 88.2% from 100.2%, mainly due to lower claims volume over this period.

CIC Guam’s ratings will remain under review until the resolution of the transaction and AM Best has the necessary information to assess the full rating impact.

Ratings are communicated to rated entities prior to publication. Unless stated otherwise, the ratings were not amended subsequent to that communication.

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