AM Best Affirms Credit Ratings of Hanwha General Insurance Company Limited

HONG KONG--(BUSINESS WIRE)--AM Best has affirmed the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Rating of “a” (Excellent) of Hanwha General Insurance Company Limited (HGI) (South Korea). The outlook of these Credit Ratings (ratings) is stable.

The ratings reflect HGI’s balance sheet strength, which AM Best assesses as strong, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management. The ratings also reflect the support that the company receives from its parent, Hanwha Life Insurance Co., Ltd. (Hanwha Life).

HGI’s risk-adjusted capitalisation is assessed at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR), including credit for hybrid securities. HGI’s capital and surplus decreased moderately at year-end 2025, mainly due to the movement of accumulated other comprehensive income following the interest rate movement and discount rate cut under the regulatory guideline during that year. As part of its solvency management efforts amid a fast evolving economic and regulatory environment, HGI has taken various initiatives, such as issuance of subordinated bonds, asset-liability management and utilization of reinsurance. HGI has good financial flexibility as evidenced by its issuance of supplementary capital securities. While its adjusted debt leverage, including equity credit for hybrid securities, increased to 22.9% following the recent issuance of subordinated bonds in 2025, it has been maintained at a positive level with an adequate coverage ratio.

HGI’s operating performance assessment remains at an adequate level with a consolidated return-on-equity of 10.3% and a combined ratio (net/net, IFRS 17 basis) of 96.2% in 2025, as calculated by AM Best. Although the company’s long-term insurance recorded double-digit growth in insurance service revenue in 2025, the profitability of this line declined like other major players mainly driven by increased claims in medical indemnity policies and market competition. The company’s stable investment income has continued to support its bottom line.

HGI is the sixth-largest non-life insurance company in South Korea, with a market share of approximately 7% in terms of gross insurance service revenue in 2025, along with diversified product offerings with relatively higher portion in long-term insurance than its domestic peers. The company’s diversified distribution network includes affiliated general agent partners, such as Hanwha Life Financial Services, a sales-specialised subsidiary of Hanwha Life. The ratings lift considers HGI’s importance to Hanwha Life in terms of strategy and earnings contribution, as well as various forms of explicit and implicit support it receives from Hanwha Life, including capital support, co-branding to increase operational synergy and distribution.

Negative rating actions could occur if there is a significant deterioration in HGI’s balance sheet strength fundamentals. Negative rating actions could also occur if there is a sustained and material deterioration in the company’s operating performance. Positive rating actions could occur if the balance sheet strength fundamentals of both HGI and Hanwha Life demonstrate sustained improvement.

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, Best’s Performance Assessments, Best’s Preliminary Credit Assessments 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 specialising 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. For more information, visit www.ambest.com.

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