Blue Cross (Asia-Pacific) Insurance Limited, a life and general insurer based in Hong Kong, maintained its “Excellent” ratings according to AM Best, with a financial strength rating of A and the issuer credit rating of “a”.
The continued positive rating is due to Blue Cross’ strong risk-adjusted capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR), and favorable business profile. It is one of the leading accident and health insurers in Hong Kong, especially for group medical schemes. Despite difficult market conditions over the past year, it has improved on its diversity in distribution channels and kept underwriting results profitable.
Blue Cross also benefited from stable income from interest and dividends over the past five years, helping the company partially offset volatility in underwriting performance and in the market value of equity investments.
However, increasing competition and inflating claims can negatively affect the company, as these two drove up the combined ratio last year. Financial market volatility also has a flow-on-effect on Blue Cross’ run-off life business and BCAR.
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