AM Best Affirms Hyundai Marine & Fire Insurance Credit Ratings
KUALA LUMPUR, June 19 (Bernama) -- AM Best has affirmed the financial strength rating of A (Excellent) and the long-term issuer credit rating of “a” (Excellent) of South Korea’s Hyundai Marine & Fire Insurance Co Ltd (HMF), with a stable outlook.
The credit ratings (ratings) reflect the insurer’s strong balance sheet strength, adequate operating performance, favourable business profile and appropriate enterprise risk management, AM Best said in a statement.
The global credit rating agency assessed HMF's risk-adjusted capitalisation at the strongest level based on Best's Capital Adequacy Ratio. It noted that the company's local solvency position improved in 2025, supported by higher interest rates and measures to reduce the duration gap between assets and liabilities.
AM Best said HMF also maintains good financial flexibility, citing its track record of issuing supplementary capital securities. However, the company’s adjusted financial leverage has risen following several rounds of subordinated debt issuance in recent years.
The insurer delivered a double-digit return on equity and a combined ratio of 96.8 per cent in 2025, according to AM Best's calculations. Profitability in its long-term insurance business weakened due to higher loss ratios in medical indemnity policies, while its auto insurance segment recorded underwriting losses amid premium rate cuts, increased competition and inflation-driven claims costs.
Despite these challenges, strong investment income supported overall earnings in 2025, driven by gains from asset disposals and higher interest income in a favourable interest rate environment.
HMF remains one of South Korea's largest non-life insurers, holding an estimated 17 per cent market share based on gross insurance service revenue in 2025.
AM Best said the company benefits from a diversified product portfolio and distribution network, as well as longstanding business relationships with Hyundai group companies, particularly in its marine insurance operations.
-- BERNAMA