AM Best Affirms Credit Ratings of Macau 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 Macau Insurance Company Limited (MIC) (Macau). The outlook of these Credit Ratings (ratings) is stable.

The ratings reflect MIC’s balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management.

MIC’s balance sheet strength remained at the strongest level at year-end 2025, as measured by Best’s Capital Adequacy Ratio (BCAR). The company’s capital and surplus increased by double-digit percentage to MOP 1.0 billion as of year-end 2025, mainly due to favorable fair value gains on equity investments through other comprehensive income (OCI) and partial retention of net profitability. Although MIC’s strategic asset allocation reflects its appetite to equity investment, high equity risk exposure is mitigated partially by the company’s surplus capital, diversified and liquid equity portfolio, and appropriate market risk controls.

MIC’s operating results have been consistently positive over the past 20 years. In 2025, the company’s net profit was mainly supported by investment results, albeit a slight underwriting loss. Driven by deterioration in its net loss ratio, especially for motor and medical businesses, the company’s net combined ratio, based on AM Best’s calculation, increased to 103.4% in 2025. AM Best expects the underwriting result to improve in 2026, as the company has tightened the underwriting discipline and discontinued some of its loss-making businesses.

The company continued to achieve favourable investment gains owing to the changes in fair value of its equity investments. The net investment return, taking into consideration the fair value gain reflected through OCI, reached 11% in 2025. MIC expects to maintain its high proportion of equity investments in the near future, which may introduce moderate volatility to its operating performance.

MIC ranked third in Macau’s non-life insurance market in 2025 in terms of gross premium written, with a market share of 11.6%. The company’s underwriting portfolio is moderately diversified, with an increased level of retention within its major business lines, including employees’ compensation, motor and medical. Going forward, MIC aims to grow in the Greater Bay Area while embracing digitalisation to enhance the service level, data accuracy and process efficiency to support its future business expansion.

Negative rating actions could arise if MIC’s business profile exhibits a sustained diminishing trend that materially deviates from its indicated plans. Negative rating actions could also occur if there is a significant deterioration in the company's operating performance, for example, due to an unfavourable underwriting loss or material investment losses. Positive rating actions could occur if MIC demonstrates sustained and favourable results to strengthen its overall operating performance, while supporting its current business profile.

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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