A.M. Best Upgrades Ratings of United Overseas Insurance Limited
HONG KONG -- April 29, 2014
A.M. Best has upgraded the financial strength rating to A+ (Superior) from A
(Excellent) and issuer credit rating to “aa-“ from “a+” of United Overseas
Insurance Limited (UOI) (Singapore). The outlook for both ratings has been
revised to stable from positive.
The ratings reflect UOI’s excellent risk-adjusted capitalization, outstanding
operating performance and well-established presence in the personal and small
and medium enterprise (SME) insurance market in Singapore. The ratings also
acknowledge UOI’s enhanced enterprise risk management framework.
UOI continues to maintain an excellent level of risk-adjusted capitalization,
as measured by Best’s Capital Adequacy Ratio (BCAR) and the local regulatory
capital adequacy ratio. Given its forecasted business growth, UOI’s
risk-adjusted capitalization is expected to remain strong in the near term.
UOI has a proven track record of outstanding operating results. The company
has significantly outperformed the Singapore general insurance market in terms
of underwriting performance. The favorable return from its investment
portfolio also contributed to UOI’s profitable operation.
As a key member of the United Overseas Bank Limited (UOB) group, UOI benefits
from its extensive client and distribution networks in addition to its brand
name recognition, which provide UOI with a competitive advantage in the
personal and SME business segments. UOI also receives support from UOB in
terms of investments and risk management.
One of the offsetting rating factors is the potential volatility in UOI’s
investment returns. With a sizable amount of equity investments, UOI's
investment performance could be impacted by any negative movement in the
equity market. However, UOI’s current level of capitalization is adequate to
absorb the potential investment earnings volatility over the short to medium
UOI is well positioned at its current rating level. Negative rating actions
could occur if UOI’s risk-adjusted capitalization declines to a level below
A.M. Best’s expectations, resulting from significant deterioration in
The methodology used in determining these interactive ratings is Best’s Credit
Rating Methodology, which provides a comprehensive explanation of A.M. Best’s
rating process and contains the different rating criteria employed in the
rating process. Best’s Credit Rating Methodology can be found at
Ratings are communicated to rated entities prior to publication, and unless
stated otherwise, the ratings were not amended subsequent to that
This rating announcement has been issued by A.M. Best Asia-Pacific Limited,
which is a subsidiary of A.M. Best Company. A.M. Best Company is the world's
oldest and most authoritative insurance rating and information source. For
more information, visit www.ambest.com.
Copyright © 2014 by A.M. Best Company, Inc. ALL RIGHTS RESERVED.
A.M. Best Company
Yanwei You, +852-2827-3421
Jeff Yeung, +852-2827-3413
Rachelle Morrow, +(1) 908 439 2200, ext. 5378
Senior Manager, Public Relations
Jim Peavy, +(1) 908 439 2200, ext. 5644
Assistant Vice President, Public Relations
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