Samsung Fire & Marine Insurance(000810) said on the 2nd that it became the first private corporations in Korea to receive an "AA" credit rating from Standard & Poor's (S&P). The "AA" is one notch higher than the previous "AA-" and is the same level as Korea's sovereign credit rating.
S&P cited as key reasons for the upgrade its solid asset-liability (ALM) duration management; excellent capital adequacy maintained even after the introduction of IFRS 17; stable profitability and internal capital generation capacity; leading position in the domestic non-life insurance market; and diversification of regions and revenue sources driven by global business expansion.
S&P projected Samsung Fire & Marine Insurance's combined ratio will gradually improve from about 91% last year to 88%–91% over the next two years.
The combined ratio, which adds the loss ratio and the expense ratio, is one of insurers' key profitability indicators. When the combined ratio exceeds 100%, it means the company is losing money on underwriting.
S&P also said Samsung Fire & Marine Insurance can support the capital needs required in the process of expanding its overseas business, and that the contribution of overseas business revenue will increase through measures such as expanding investment in Canopius, a Lloyd's insurer.
A Samsung Fire & Marine Insurance official said, "This credit rating is a meaningful achievement that recognizes our strengthened capital base, risk management capabilities, and sustainable growth potential," adding, "We will provide stable insurance services to customers and grow into a trusted top-tier insurer in the global market."