News, ratings
B++ for Jordan Insurance
| January 26, 2010 by Hussain Hadi
Jordan Insurance Company’s ‘good’ rating reflects its robust performance, AM Best Co says.
AM Best Co has assigned a financial strength rating (FSR) of B++ (Good) and an issuer credit rating (ICR) of “bbb” to Jordan Insurance Company Plc (JIC). The ratings of JIC reflect its strong level of risk-adjusted capitalisation, robust underwriting performance and established profile in the Jordanian insurance market. An offsetting factor is the firm’s investment strategy, which gives rise to volatile investment performance.
According to AM Best, the company experienced robust underwriting results across all lines of business, with consistently improving technical profits of approximately JOD4.7m (US$ 6.8m) in 2008, supported by an excellent combined ratio of 75 per cent. Conversely, JIC has an investment strategy that gives rise to volatile investment performance, with significant concentration (in excess of 50 per cent at year-end 2008) of investments in equity markets.
In AM Best’s opinion, JIC is taking measures to adopt a more prudent approach to investment risk management in order to create a balanced portfolio. Despite JIC’s variable investment performance, the company has reported investment returns of 16 per cent in 2008, benefitting from JOD5.8m (US$8.3m) from realised gains on equity.
JIC has established a strong market position in Jordan with a diversified portfolio for both non-life and life insurance, accounting for nine per cent of gross market premiums.
