RUSSIA: rating of ROSGOSSTRAKH raised to ruAA-, outlook stable

25 April 2019 — Marina MAGNAVAL
The rating agency Expert RA upgraded the national rating of ROSGOSSTRAKH to ruAA-, outlook stable. Previously the insurer had ruA rating, outlook positive, as reported by ASN.

The rating upgrade was due to an increase in the company's asset diversification, as well as improvement of its financial performance in 2018. The insurer also significantly reduced the loss ratio of the main lines and the portfolio in total, which, according to the agency, had a positive impact on the rating. The net loss ratio of MTPL decreased from 123% in 2017 to 57.5% in 2018, in Motor Hull from 69.3% to 58.4%, for the portfolio in general from 74.5% to 32.6%, the combined net loss ratio decreased from 125% to 93.5%.

Among restraining and negative factors, the agency noted a low level of profit in 2018 (RUB 5.6 billion after tax), return on sales (7.3%), return on capital (11%) and investments, decline of GWP (-22.5%) due to optimization of the portfolio structure, and an increase in the share of business costs in net GWP (65.3%).

ROSGOSSTRAKH's market share in 2018 amounted to 4.1%. According to Expert RA, as of 31.12.2018, the insurer's assets amounted to RUB 130.8 billion, equity was RUB 44.8 billion and charter capital was RUB 19.6 billion.

*EUR 1 = RUB 79.4605 (as of 30.12.2018)

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