LONDON--(BUSINESS WIRE)--AM Best has assigned a Financial Strength Rating of A (Excellent) and a Long-Term Issuer Credit Rating of “a+” (Excellent) to Helvetia Schweizerische Versicherungsgesellschaft AG (Helvetia Insurance) (Switzerland), the main operating subsidiary of Helvetia Holding AG (Helvetia). The outlook assigned to these Credit Ratings (ratings) is stable.
The ratings reflect Helvetia’s consolidated balance sheet strength, which AM Best assesses as very strong, as well as its strong operating performance, neutral business profile, and appropriate enterprise risk management. The ratings factor in Helvetia Insurance’s strategic importance to Helvetia and its full integration within the group.
Helvetia’s balance sheet strength is underpinned by its consolidated risk-adjusted capitalisation, that AM Best expects to remain comfortably above the minimum required for the strongest assessment, as measured by Best’s Capital Adequacy Ratio (BCAR), supported by prudent capital management. The group has a conservative investment allocation, weighted toward investment-grade fixed income instruments, and prudent reserving practices, with a history of favourable reserve development. The assessment also considers the group’s excellent financial flexibility, with proven access to the debt and capital markets, and strong regulatory solvency position, with a Swiss Solvency Test capital adequacy ratio of 300% estimated at 30 June 2024.
Helvetia has a track record of strong operating performance, supported by income streams spread across life and non-life operations, with additional income generated from fee-related business. The group reported a solid net profit of CHF 258 million in the first half of 2024, translating in an annualised return on equity of 13.4%. Operating results have been supported by solid technical profitability, evidenced in the first half of 2024 by a combined ratio of 95.4% (net-gross), life new business margin of 4.9%, and income from fee activities of CHF 24 million. Operating performance is expected to remain strong, supported by favourable market conditions in Helvetia’s core lines of business, and recent management actions implemented to improve technical profitability.
Helvetia’s business profile benefits from a well-established brand, and good geographic and product diversification. The group has a strong market position in the Switzerland life and non-life segments, supported by a multichannel distribution strategy servicing a large customer base, and international operations, primarily across Europe. Helvetia reported insurance revenue of CHF 4.5 billion in the first half of 2024, and expects its non-life portfolio, notably its specialty segment, to be a key driver of the group’s growth in the coming years.
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