ENP Newswire -
Release date- 27022014 -
The outlook assigned to both ratings is stable.
The ratings reflect CTIUK's improving operating performance and good risk-adjusted capitalisation. The ratings also take into account the company's niche business profile and strong links with its ultimate parent, state-owned
CTIUK is a niche insurer catering predominantly to the needs of the Chinese communities established in the
Despite CTIUK's volatile earnings in the past, its profit before tax has improved in the last couple of years. This was driven by a more stable underwriting performance following the cancellation of loss-making professional indemnity business and recovering investment results. Going forward, the company is targeting a profit in the range of
CTIUK's risk-adjusted capitalisation has been improving in recent years as a result of lower exposure to equity investments, relatively stable net written premium and increasing retained earnings. Going forward, the balance sheet strength is expected to remain supportive of the current ratings, despite the strong premium growth anticipated in 2014.
Positive rating actions could occur for CTIUK if, over the next few years, it consistently improves its underwriting results while maintaining adequate risk-adjusted capitalisation. Negative rating actions could occur as a result of excessive growth leading to a significant deterioration of earnings or risk-adjusted capitalisation.
The methodology used in determining these ratings is Best's Credit Rating Methodology, which provides a comprehensive explanation of
In accordance with Regulation (EC) No. 1060/2009, the following is a link to required disclosures: www3.ambest.com/emea/ambersdisclosure.pdf.
This rating announcement has been issued by A.M. Best
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