AM Best Affirms Credit Ratings of COSCO SHIPPING Captive Insurance Co., Ltd.

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 COSCO SHIPPING Captive Insurance Co., Ltd. (COSCO SHIPPING Captive) (China). The outlook of these Credit Ratings (ratings) is stable.

The ratings reflect COSCO SHIPPING Captive’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. The ratings also reflect the captive insurer being a strategically important member of its parent, China COSCO SHIPPING Corporation Limited (COSCO SHIPPING), and the wide range of support provided by COSCO SHIPPING in areas such as business development, risk management, and managerial and capital support.

COSCO SHIPPING Captive’s balance sheet strength is underpinned by its risk-adjusted capitalisation being well above AM Best’s minimum requirement for the strongest assessment level, as measured by Best’s Capital Adequacy Ratio (BCAR). The captive’s balance sheet strength assessment considers its very low underwriting leverage, conservative investment strategy, and comprehensive reinsurance programme. AM Best expects the profitable group-related business and stable investment return to continue to support the capital growth through profit accumulation.

COSCO SHIPPING Captive has consistently delivered positive earnings since 2017 and achieved an average return-on-equity ratio of 5.3% over the past five years (2021-2025). The captive’s underwriting performance benefits from stable premium contribution of the marine hull business, favourable reinsurance commission income and low acquisition costs, albeit offset by marginal net loss experience due to a small net earned premium base. The captive’s investment performance remained stable with a net investment yield (including capital gains) of 2.9% in 2025. The captive maintains a conservative investment appetite, with a strong focus on fixed-income-oriented assets that provide a stable stream of investment income.

COSCO SHIPPING Captive’s underwriting book primarily consists of marine hull business for the parent group and its affiliates. Other business lines include liability, commercial property, cargo, motor, accident and health. The captive leverages direct and internal broker channels to serve the group’s insurance needs efficiently, while enhancing visibility into underlying risks and supporting overall risk management.

Negative rating actions could occur if there is a material deterioration in COSCO SHIPPING Captive’s operating performance. Negative rating actions also could arise if there is a reduced level of support from COSCO SHIPPING or a significant deterioration in COSCO SHIPPING’s financial strength or credit profile. Positive rating actions may occur if the captive demonstrates sustained and favourable operating performance while supporting its current business profile assessment.

AM Best remains the leading rating agency of alternative risk transfer entities, with more than 200 such vehicles rated throughout the world. For current Best’s Credit Ratings and independent data on the captive and alternative risk transfer insurance market, please visit www.ambest.com/captive.

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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