Min Xin Insurance (MXIC) has been recognized for its robust balance sheet, underpinned by strong risk-adjusted capitalisation, according to AM Best. The credit rating agency assessed the company’s balance sheet as strong, citing adequate operating performance, a limited business profile, and sound enterprise risk management.
As of the end of 2023, MXIC’s capital position was at its strongest level, as reflected by the company’s Capital Adequacy Ratio (BCAR). Over the past decade, the insurer has seen significant growth in its capital and surplus (C&S), driven by both capital injections from its parent company, Min Xin Holdings Limited (MXHL), and retained profits.
Additional strengths highlighted by AM Best include a healthy regulatory solvency position, strong liquidity, and prudent reinsurance arrangements. However, these positive factors are partially offset by the company’s investment concentration in a single property, as well as its relatively small C&S size of $40.8 million under the Hong Kong Financial Reporting Standards (HKFRS 17).
MXIC, a wholly owned subsidiary of MXHL, benefits from the financial backing of its parent company. MXHL is majority-controlled by Fujian Investment & Development Group, a state-owned enterprise of the Fujian provincial government.
Looking to the future, AM Best expects MXIC to maintain its strong capitalisation and continue to leverage its investment and bancassurance strategies to drive profitability, despite challenges in scaling its underwriting performance.
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