SLIC sole insurer to secure AAA (lka) Fitch Rating amidst turbulent times

Tuesday, 15 December 2020 00:30 - - {{hitsCtrl.values.hits}}

Rating endorses company’s strong financial credentials and capitalisation

Sri Lanka Insurance (SLIC) has emerged as the only insurer in Sri Lanka to maintain National Insurer Financial Strength (IFS) rating of ‘AAA (lka) with a Stable Outlook amidst the turbulent times proving the prowess and stature of the insurance giant.

The rating reflects the favourable business profile, strong financial performance and capitalisation of the company maintained over time within a challenging business environment. The pioneer of the insurance industry is shifting paradigms and setting benchmarks in the industry with AAA (lka) rating which is the highest score in the national rating scale.

On the international rating scale along with the Sri Lankan sovereign rating of ‘CCC’, Sri Lanka Insurance recorded at ‘CCC+’ and SLIC’s rating continues to reflect its ‘Favourable’ business profile, and a capital position and financial performance better than that of the domestic insurance industry. Sri Lanka Insurance is the only insurer in the Sri Lankan insurance industry to secure this highest achievement in terms of financial stability which bears witness to the unmatched protection provided to the policyholders. This is a reflection of Sri Lanka Insurance’s superior ability to meet the long-term insurance obligations to its policyholders despite challenging times.

Fitch assesses SLIC’s business profile as ‘Favourable’ compared with other Sri Lankan insurance companies due to the impeccable business profile comprised with leading business franchise, well-diversified participation in business lines across life and non-life insurance sectors, stable business focus on established product lines and its favourable domestic operating scale making Sri Lanka Insurance the only insurer to secure the robust financial rating and for the second consecutive time.

Fitch’s assessment is based on SLIC’s diverse portfolio across the life and non-life sectors, stable business focus and operating scale. This also comes down to its financial strength and fiduciary management practices.

SLIC has continued to maintain its Life and General regulatory risk-based capital (RBC) ratios (a measurement of its capitalisation) of 451% and 203% respectively at the end of first half of the year 2020, which is well over the industry average and also above regulatory minimum of 120%. The company has also consistently maintained its non-life combined ratio below 100% for the previous five years which attributes to the company’s scale advantage and prudent underwriting practices.