KUALA LUMPUR, May 17 (Bernama) -- AM Best has affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Rating of ‘a-’ of Police Health Plan Limited (PHP) New Zealand.
The outlook of these Credit Ratings (ratings) is stable, according to a statement.
The ratings reflect PHP’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.
In addition, the ratings factor in a neutral impact from the company’s ultimate ownership by the New Zealand Police Association.
PHP’s balance sheet strength assessment is underpinned by its risk-adjusted capitalisation, which remains at the strongest level, as measured by Best’s Capital Adequacy Ratio, reflecting its moderate underwriting leverage and conservative investment approach.
As a not-for-profit insurer, AM Best views the company’s financial flexibility as limited, although this is partially mitigated by the company’s prudent capital management and track record of robust internal capital generation.
An offsetting balance sheet factor is the company’s modest-sized absolute capital base, which increases the sensitivity of capital adequacy to stress scenarios or fluctuations in performance.
The global credit rating agency, AM Best assesses PHP’s operating performance as adequate, with a five-year average return-on-equity ratio of 5.5 per cent (fiscal-years 2016-2020), albeit with a moderate level of volatility over this period.
PHP is a not-for-profit organisation that provides health insurance exclusively to current and former members of the New Zealand police force and their families.
More details at www.ambest.com.
-- BERNAMA
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