A.M. Best Affirms Ratings of Hang Seng Life Limited.OLDWICK, N.J. -- A.M. Best Co. has affirmed the financial strength rating of A+ (Superior) and the issuer credit rating of "aa-" of Hang Seng Hang Seng An index of the leading stocks on the Hong Kong stock market. Notes: The Hang Seng Index (HSI) comprises different stocks that are representative of the whole Hong Kong market. See also: DAX, Index, Nikkei, S&P 500 Life Limited (Hang Seng Life) (Hong Kong Hong Kong (hŏng kŏng), Mandarin Xianggang, special administrative region of China, formerly a British crown colony (2005 est. pop. 6,899,000), land area 422 sq mi (1,092 sq km), adjacent to Guangdong prov. ). The outlook for both ratings is stable. The ratings reflect Hang Seng Life's strong operating performance, stable business growth in its selected market, improved capitalization and stable market presence. The ratings also consider the ongoing distribution support of Hang Seng Bank Hang Seng Bank Limited (Traditional Chinese: 恒生銀行有限公司) HKSE: 0011 is the second largest bank in Hong Kong. It is a listed company but it is majority owned (62. and the sustained increase in embedded value Embedded Value A common valuation measure used outside North America particularly in the insurance industry. It is calculated by adding the adjusted net asset value and the present value of future profits of a firm. . Hang Seng Life's profitability increased substantially to HKD HKD In currencies, this is the abbreviation for the Hong Kong 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. 316 million (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. 41 million) in 2006 from HKD 189 million (USD 24 million) in 2005 due primarily to favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. underwriting Underwriting 1. The process by which investment bankers raise investment capital from investors on behalf of corporations and governments that are issuing securities (both equity and debt). 2. The process of issuing insurance policies. experience and good investment results. As 87% of its direct in-force premiums were derived from regular contribution products in 2006, Hang Seng Life's source of premium income is less sensitive to fluctuations in the life market. Sustained business growth had resulted in a substantial increase in asset size during the year, which placed considerable stress on Hang Seng Life's risk-adjusted capitalization. The increase in asset risk carried by Hang Seng Life was offset by a capital contribution of HKD 500 million (USD 64 million) in 2006, resulting in an improved risk-adjusted capitalization. Given the strong growth experienced by Hang Seng Life, A.M. Best views the ongoing capital support provided to the company as crucial in maintaining its current rating. Strong growth in Hang Seng Life's market of choice contributed to the sustained growth in the company's embedded value. In-force premiums for non-linked individual regular premium products written by Hang Seng Life increased by 25%, compared to the market increase of 12%. In addition to a general improvement in persistency, mortality experience has been better than planned. Hang Seng Life's embedded value increased by 23% in 2006. Hang Seng Life has been afforded a wide distribution reach through Hang Seng Bank's extensive branch network in Hong Kong. This distribution capability, together with the use of the Hang Seng brand, has given Hang Seng Life a strong platform for growth and an advantage over its agency-reliant competitors in acquiring new business and servicing existing customers. These positive factors are partially offset by pressure from intense competition in the life insurance market. Hang Seng Life's sustained growth momentum in the individual non-linked market is expected to be counteracted by market competition over the longer term. Hang Seng Life's market share declined over the past year due primarily to strong market demand for unit-linked products. Founded in 1899, A.M. Best Company is a full-service credit rating organization dedicated to serving the financial services The examples and perspective in this article or section may not represent a worldwide view of the subject. Please [ improve this article] or discuss the issue on the talk page. industries, including the banking and insurance sectors. For more information, visit www.ambest.com. |
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