AM Best has assigned a Financial Strength Rating of A- (Excellent) and a Long-Term Issuer Credit Rating of 'a-' (Excellent) to
The outlook assigned to these Credit Ratings (ratings) is stable.
The ratings reflect China P&I'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.
China P&I's risk-adjusted capitalisation is assessed as being at the strongest level as of year-end 2021, as measured by Best's Capital Adequacy Ratio (BCAR), and is expected to remain so over the short to intermediate term, underpinned by continued growth through full earnings retention and a very low underwriting leverage. The Club's consolidated capital and surplus has grown at a compound annual growth rate of 9.6% over the past five years and reached a sizeable
China P&I has reported net profits consistently over the past five years, with an average return on equity of 7.3% during the period, which compares favourably against its
China P&I was established in 1984 as a mutual association. Since then, the Club has continued to build close relationships with its members and maintain an extensive global network of business partners. The Club has a dominant market share in
China P&I is well-positioned at the current rating level. Negative rating actions may occur if the Club's balance sheet strength no longer supports the current assessment, for example, due to material deterioration in the level of risk-adjusted capitalisation arising from heightened investment risk. Negative rating actions may arise if the Club's operating performance demonstrates a sustained and material deteriorating trend, for example, due to continued adverse investment results that significantly drag on overall profitability and erode its capital position.
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.
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