S&P talks long-term insurer financial strength of Kazakh Oil Insurance Co.
Baku, Azerbaijan, September 24
By Nargiz Sadikhova - Trend:
Rating agency S&P Global Ratings on Sept.24 affirmed its 'B+' long-term insurer financial strength and issuer credit ratings on Kazakhstan-based JSC Oil Insurance Co. (NSK), the outlook is stable, Trend reports with reference to agency’s report.
At the same time, agency affirmed 'kzBBB' national scale rating on the company.
“The stable outlook reflects our view that the company can restore its business volume and underwriting performance over the next 12 months, allowing it to maintain its current capital adequacy and comply with regulatory capital requirements,” the report said.
Furthermore, the agency anticipates that NSK’s net combined (loss and expense) ratio will increase to around 100 percent in 2019 from 93 percent last year due to the decline of net earned premiums and increased expenses to attract clients that left the company while its licenses were frozen.
“We expect the ratio will improve to around 98 percent in the next two years NSK's business volume increases. We assume that the company’s dividends won’t exceed 40 percent of net profit over the next two years,” the report said.
Furthermore, the agency views NSK’s liquidity as adequate, with agency’s liquidity ratio of 163 percent at the end of 2018 implying that stressed liquid assets are 1.63x higher than stressed liabilities.
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