A.M. Best has revised the outlook to stable from positive and affirmed the financial strength rating of B++ (Good) and the issuer credit rating of “bbb+” of United India Insurance Company Limited (UIIC).
The underwriting performance of UIIC has improved since fiscal year 2011-12; however, the actual performance was continuously worse than projected. Deterioration in UIIC’s underwriting result in fiscal year 2014-15 is attributed to severe catastrophic losses and its loss-making health business.
Partially offsetting these negative factors are UIIC’s strong balance sheet strength and robust market profile.
UIIC’s strong balance sheet strength was supported by the solid risk-adjusted capitalization level, as measured by Best’s Capital Adequacy Ratio (BCAR), and the high liquidity of its investment portfolio. In the near future, the favorable investment performance and the high retained earnings will enable UIIC to grow its capital and surplus parallel to its growth in business risk.
Despite intense competition from public and private insurers, UIIC continuously ranked third among India’s non-life insurance companies based on gross direct premium written there. UIIC also has the extensive distribution network throughout the country with its large number of micro offices.
A.M. Best Company is the world’s oldest and most authoritative insurance rating and information source.
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