Provident Insurance's credit ratings remain unchanged
Published on: Tuesday, February 13, 2018

Kuala Lumpur: The financial strength rating of Provident Insurance Corp Ltd (Provident) New Zealand remains at B++ (good) and the long-term issuer credit rating at "bbb", while the outlook of these ratings remains stable, according to A.M. Best.This followed Provident acquiring the business assets of Credit Union Insurance Ltd New Zealand (Co-op), Provident's current underwriter for motor vehicle insurance.

Provident made an initial payment and is underwriting its own motor vehicle policies through Co-op's systems and personnel.

Meanwhile, stage two of the transaction involves the transfer of Co-op's existing book of policies to Provident, pending regulatory approval that is likely to finalise by the next quarter.

Though the acquisition is funded out of Provident's existing capital, A.M. Best expects Provident's risk-adjusted capitalisation, as measured by Best's Capital Adequacy Ratio (BCAR), to remain, in the near term, at a level that is supportive of the current ratings.

The business transition and acquisition payment is expected to complete in the third quarter of 2018.

A.M. Best will continue to monitor the progress of the transaction and evaluate developments for any impact on the ratings. – Bernama


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