AM Best has affirmed its financial strength rating of B++ (good) and the long-term issuer credit rating of bbb+ (good) for China’s Zhongyuan Agricultural Insurance Co (ZYIC). The outlook of these ratings is stable, AM Best said.
Concurrently, AM Best has withdrawn the ratings as ZYIC has requested to stop participating in AM Best’s rating process.
“The ratings reflect ZYIC’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,” AM Best said.
AM Best said it expected the company to benefit from capital support from its shareholders to drive business expansion over the short to medium term. Its fixed income-oriented investment portfolio with strong liquidity and a debt-free balance sheet also support its overall balance-sheet strength. ZYIC’s focus on agricultural insurance and its significant catastrophe exposure relative to its size are offsetting factors, the rating agency said.
Strong growth in key products, including crop and livestock, contributed to the growth in ZYIC’s premium income in 2021 and 2022, AM Best said.
ZYIC has been the leading professional agricultural insurer in China’s Henan province for six consecutive years. IT also continues to strengthen its presence in Inner Mongolia and Heilongjiang, AM Best said.
ZYIC also recently received a favourable financial strength rating from Fitch.
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