Etiqa General Insurance Berhad (EGIB), a leading Malaysian non-life insurer, has reported the strongest balance sheet in its history as of year-end 2023, bolstered by its solid risk-adjusted capitalisation, according to AM Best.
The global credit ratings firm noted that EGIB employs a moderate-risk investment strategy, blending low-risk assets such as cash, deposits, and bonds with higher-risk investments in equities and real estate. The company also relies heavily on reinsurance, maintaining a net retention ratio of 34% in 2023. This dependency has resulted in a significant balance in reinsurance recoverables on EGIB’s balance sheet.
EGIB’s operating performance remains robust, benefiting from a favorable underwriting performance and steady investment income. The company’s core business lines, including fire and personal accident insurance, have contributed to a low net loss experience. Additionally, favorable reinsurance commission income from ceded risks has supported its technical profitability over the years.
In 2023, EGIB’s operating performance remained strong, driven by improved investment returns, despite lower underwriting results. However, AM Best highlighted that the gradual liberalisation of motor and fire insurance pricing in Malaysia may impact underwriting margins in the future. Nevertheless, the firm expects EGIB to sustain its strong operating performance in the medium term, supported by disciplined underwriting and pricing strategies.
EGIB is classified as a midsized insurer in Malaysia, holding a market share of around 10% based on its 2023 gross written premiums. The company’s underwriting portfolio is moderately diversified across different business lines and distribution channels, with the majority of its business originating from Malaysia.
As a member of the Maybank group, EGIB benefits from robust distribution capabilities, leveraging its parent’s banking network for preferential access to business. Despite the competitive conditions expected to persist in Malaysia’s general insurance market, EGIB is well-positioned to navigate these challenges moving forward.
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