AM Best Affirms Credit Ratings of Jordan Insurance Company Plc.
03 Julio 2024 - 10:49AM
Business Wire
AM Best has affirmed the Financial Strength Rating of B
(Fair) and the Long-Term Issuer Credit Rating of “bb+” (Fair) of
Jordan Insurance Company Plc. (JIC) (Jordan). The outlook of these
Credit Ratings (ratings) is stable.
The ratings reflect JIC’s balance sheet strength, which AM Best
assesses as strong, as well as its adequate operating performance,
neutral business profile and marginal enterprise risk management
(ERM).
JIC’s balance sheet strength is underpinned by its risk-adjusted
capitalisation at the very strong level, as measured by Best’s
Capital Adequacy Ratio (BCAR). JIC’s BCAR scores have improved in
recent years as a result of measures taken by management to
strengthen the balance sheet, including the suspension of dividend
payments and the divesture of certain capital-intensive
investments. Nonetheless, AM Best views liquidity, as well as asset
and liability management, as partially offsetting rating factors,
as JIC maintains significant investment concentrations within the
equity and real estate asset classes. The company’s prospective
liquidity position will depend on its ability to continue derisking
its investment portfolio. The ratings also consider JIC’s moderate
dependence on reinsurance for large property and engineering risks,
which is viewed as an offsetting factor; however, this is mitigated
partially by a reinsurance panel of good credit quality.
JIC has a track record of adequate operating performance,
despite challenging market conditions in the Jordanian and UAE
markets. JIC reported a return-on-equity ratio of 4.3% in 2023, an
improvement from the prior year, primarily driven by the
profitability of its life portfolio and higher investment income.
Prospective operating performance will depend on the company’s
ability to maintain underwriting discipline.
JIC has an established position in Jordan’s insurance market,
where it is ranked No.2 based on gross written premium (GWP).
However, Jordan’s insurance market remains relatively small by
international standards. The company’s GWP is well-diversified
across a range of life and non-life business lines, although on a
net basis, is concentrated in motor and medical, albeit to a lesser
extent than its domestic market peers. JIC benefits from a degree
of geographic diversification via its branch offices in the UAE and
Kuwait.
JIC demonstrates good controls and adequate risk management in
respect of its underwriting operations. Nevertheless, limitations
in investment, liquidity and capital management have a negative
impact on AM Best’s assessment of the company’s ERM.
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.
Copyright © 2024 by A.M. Best Rating
Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240703869267/en/
Marving Lopez Financial Analyst +44 20 7397
4389 marving.lopez@ambest.com
Ben Diaz-Clegg Associate Director, Analytics
+44 20 7397 0293 ben.diaz-clegg@ambest.com
Christopher Sharkey Associate Director, Public
Relations +1 908 882 2310 christopher.sharkey@ambest.com
Al Slavin Senior Public Relations Specialist +1
908 882 2318 al.slavin@ambest.com