Monday 12 January 2015

Fitch affirms HNB Assurance; assigns rating to HNB GI

Fitch Ratings Lanka has affirmed HNB Assurance PLC's (HNBA) National Insurer Financial Strength Rating and National Long-Term rating at 'A(lka)'. Fitch has also assigned HNBA's subsidiary HNB General Insurance Ltd (HNB GI) a National Insurer Financial Strength Rating and National Long-Term rating of A(lka). All ratings have a Stable Outlook.

The ratings reflect the Sri Lanka-based Insurance group's comfortable capitalisation in terms of regulatory solvency, its prudent policy towards investment and modest market share. The ratings also reflect Fitch's expectation that HNBA will receive distributional synergies from parent, Hatton National Bank PLC (HNB, AA-(lka)/Stable), due to HNBA's importance to the bank in providing additional bancassurance products and HNB's 60% ownership of the insurance group.

HNBA was established in 2001 and operated as a composite insurer until end 2014. The ratings acknowledge the status of HNB GI as a core operating entity of HNBA.

Fitch views the consolidated capital strength of HNBA as strong. At 3Q14, the life regulatory solvency was 2.84X (2013: 2.04x, 2012: 2.28x) and this was 2.67X (2013:3.89x 2012: 3.48x) in non-life, comfortably above the regulatory required level of 1.0x for both life and non-life.
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