A.M. Best Affirms Rating of Dongbu Insurance Company Ltd.Business Editors OLDWICK, N.J.--(BUSINESS WIRE)--Oct. 20, 2003 A.M. Best Co. has affirmed the financial strength rating of A- (Excellent) of Dongbu Insurance Company Ltd (South Korea). The rating outlook is stable. The rating reflects the company's consistent operating performance, solid market position and gradual improvement in risk-based capitalization. Dongbu Insurance has achieved consistent improvement in its underwriting performance. The company's underwriting results increased to KRW KRW In currencies, this is the abbreviation for the Korean Won. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. 24 billion (USD USD In currencies, this is the abbreviation for the U.S. Dollar. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. 19 million) in fiscal year 2002 from KRW -156 billion (USD -141 million) in fiscal year 1999. Dongbu Insurance has consistently achieved one of the lowest expense ratios in the Korean non-life industry. Driven by its prudent investment strategy over the past five years, the Years, The the seven decades of Eleanor Pargiter’s life. [Br. Lit.: Benét, 1109] See : Time company has steadily generated net income with limited volatility. Despite the intense competition in the motor market, Dongbu Insurance has been able to maintain its overall market share by strengthening its position in the commercial lines sector. Dongbu Insurance has maintained a solid financial position, as measured by the Best's Capital Adequacy Ratio Capital adequacy ratio (CAR), also called Capital to Risk (Weighted) Assets Ratio (CRAR)[], is a ratio of a bank's capital to its risk. National regulators track a bank's CAR to ensure that it can absorb a reasonable amount of loss. (BCAR BCAR Brunswick County Association of Realtors BCAR British Civil Airworthiness Requirements BCAR Bullitt County Animal Rescue (Shepherdsville, KY) BCAR Business Case Analysis Report BCAR Beaver Creek Array BCAR Buffalo Civic Auto Ramps, Inc. ). The Korean solvency ratio Solvency Ratio One of many ratios used to gauge a company's ability to meet long-term obligations. Notes: Derived by taking a company's net worth and dividing by total assets. See also: Asset, Asset Valuation, Balance Sheet, Fundamental Analysis, Income Statement , which currently stands at 179%, also reflects the company's adequate solvency position. Consistent financial performance coupled with a slow down of business growth will further reinforce risk based capital and surplus. Offsetting these positive rating factors are the low interest rate environment, increasing popularity of direct channel and bancassurance Bancassurance A French term referring to the selling of insurance through a bank's established distribution channels. Notes: The result is a bank that can offer banking, insurance, lending, and investment products to a customer. and the company's relatively high strategic investments, including those in Anam Semiconductor, Hana Bank and Dongbu Life Dongbu Life Insurance Co, Ltd. (Hangul: 동부생명) is a South Korean insurance company, headquartered in Seoul and established in 1989. The life insurance group division of the company controls a large portion of the South Korean calling card market life . These strategic investments may impose some volatility on the company's capital. The low interest-rate environment exerts significant pressure on Dongbu Insurance's margin, particularly in its long-term savings products. To enhance its margin, the company is re-aligning its business focus towards variable interest products as well as protection type products with fewer savings features. Dongbu Insurance is expected to be challenged by companies utilizing bancassurance and direct channels as their distribution strategies. An increase in market penetration by other market participants through direct channel will lead to greater competition in the industry. Also, with the further development of bancassurance, the competition in long-term savings products, including annuities, will be intense. A.M. Best Co., established in 1899, is the world's oldest and most authoritative insurance rating and information source. For more information, visit A.M. Best's Web site at www.ambest.com. |
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