SOUND UNDERWRITING KEY AT HSBC INSURANCE (ASIA)

Hong Kong-based HSBC Insurance (Asia) needs to enhance its stand-alone capitalization by retaining operating earnings to support risk inherent within the insurance book going forward, ratings agency AM Best has suggested. Still AM Best has affirmed the financial strength rating of A+ (superior) on the insurer, noting in particular the insurer’s sound underwriting earnings, leading market presence and diversified insurance products offerings. The insurer achieved an average combined ratio of 78.5% during 2003 to 2007 and last year became the largest insurer in the Hong Kong general insurance market, representing 6.7% market share in gross premiums written. AM Best said it remained cautious about the impact of future business growth on HSBC Insurance (Asia)’s risk-based capitalisation on a stand-alone basis, although it anticipated that the parent, HSBC, would provide capital support should the need arise.