FANews
FANews
RELATED CATEGORIES

Zurich SA AA+ rating maintained

14 December 2007Zurich Insurance Company

International credit rating agency, Global Credit Ratings (“GCR”), has reaffirmed Zurich Insurance Company South Africa Limited’s (“Zurich SA”) claims paying ability rating of AA+ (double A plus). The rating is reflective of the insurer’s high claims paying ability.

Zurich SA is one of the strongest insurers in the South African market and is the holding company of various entities including short term insurance holdings in Botswana (100%), Zimbabwe (49%) and South Africa (including Zurich Risk Finance at 100%). The company’s rebranding to its current name (previously SA Eagle) was viewed positively as it implies a level of support from its parent company, Zurich Financial Services, which is internationally rated AA-. GCR Insurance Analyst Iris Pilane stated that the company’s change in organisational structure, affording the local entity global skills and product analysis platforms, will most likely increase its ability to underwrite larger risks than in the past. This is further supported by the insurer’s comprehensive reinsurance programme, which limits its largest potential loss to around 2% of 2006 shareholders capital.

Zurich SA’s international solvency margin rose to 55% in 2006. In addition, the company continued to reflect a statutory solvency margin that exceeds the minimum level, increasing to 35% from a previous 31%. The company’s largest risk exposure in 2006 related to motor insurance business, which given the high claims inflation (driven by increasing prices on motor parts and the Rand depreciation in 2006) pushed its overall loss ratio up by a significant 5.2% to 72.6% for the year. Notwithstanding, Zurich SA’s investment policy supported a rise in its claims cash coverage to 4 months.

Quick Polls

QUESTION

Health Minister Aaron Motsoaledi has said that the NHI will bring about change in the industry which will see medical schemes a slim picture of their former selves. Do you think this is the right approach to be taken?

ANSWER

No, medical schemes offer invaluable coverage in a market that is being ravaged by high costs.
Yes, universal healthcare will benefit the country in the long run.
Just wait, the minister will soon find out that a medical industry without medical schemes is no industry at all.
AE fanews magazine
FAnews April 2017 EditionGet the latest issue of FAnews

This month's headlines

Falling from grace to junk
From the hunter to the hunted
Are we there yet?
The adviser’s new go to trick
Calling the retirement superhero
Subscribe now