RUSSIA: RAEX confirmed rating of RSHB-Insurance at ruAA, forecast stable
Also among its main insurance types are accidents, illness and property of legal entities insurance. Accidents and illnesses generated 36.8% of the insurer's GWP in the first half year. This, according to the agency, is a positive feature of the company's portfolio high diversification. The insurer has a wide geographical network (49 subjects of Russia), and the biggest area of its activity (Moscow) accounted for 36.5% of GWP in 1H 2018.
Based on the agency's methods, the company has a high size indicator (2nd class). Its insurance portfolio is growing rather fast (11.6% for 1H 2018 y-o-y). The biggest part of GWP is generated without intermediaries (52% in the first half year), and the biggest sales channel of distribution (credit institutions), except for direct sales, accounts for 36.2% of all GWP (based on 1H 2018 result), which means the absence of significant business concentration risks in one sale channel and affects the rating positively. At the same time total intermediaries' fees of the biggest sales channel in the 1H 2018 amounted to only 15.7%, which is also positively estimated by the agency. Some negative influence on the rating comes from low diversification of the insurer's client base: the TOP-5 clients in the 1H 2018 accounted for 43.5% of GWP, as ASN informed.
Otherwise, the company has high financial results (32.6% - profitability of sales, 103% - return on equity, 11.2% - return on investment). The rating was also positively affected by a low loss ratio (22.6% in the 1H 2018) and low combined ratio (56.6%). The company's equity in the first half year increased by 50.9% y-o-y. The insurer has high liquidity and solvency reserves, as well as high asset quality and high reliability of reinsurance coverage. However, the agency pointed out that a low ratio of settled claims to the number of claim events under insurance of other property of individuals, despite some positive dynamics, and high share of payment refusal cases under insurance of accidents and illnesses (15.3% in the first half year).
According to RAEX (Expert RA) as of 30.06.2018 the insurer's total assets amounted to RUB 12.4 billion, total equity - RUB 2.3 billion, charter capital - RUB 627.8 million. For the 1H 2018 the company generated RUB 3.4 billion of GWP, said ASN.
*EUR 1 = RUB 72.9921 (as of 30.06.2018)