The ratings reflect Kazkommerts-Policy’s developing business profile, supportive level of risk-adjusted capitalisation and volatile underwriting results. The ratings also consider Kazkommerts-Policy’s exposure to the heightened country risk in
Kazkommerts-Policy’s business profile has undergone material changes in recent years due in particular to changes in its senior management and modifications in the regulatory environment in
Kazkommerts-Policy historically has reported underwriting losses primarily due to its high expenses relative to premiums and losses from its workers’ compensation run-off portfolio. However, underwriting performance improved in 2016, demonstrated by a combined ratio of 69.4% (under national accounting standards) for the first nine months of the year compared with the weighted average of 114.5% reported for 2011-2015. The improvement was attributed to strong premium growth, as well as to reserve releases from the workers’ compensation book due to some policyholder-specific benefits and a change in claims’ development pattern following legislative amendments enforced in 2015 that limit insurers’ liability for workers’ compensation claims.
Kazkommerts-Policy’s financial strength currently is not considered to be affected by the vulnerable credit profile of its parent, Kazkommertsbank. This reflects A.M. Best’s consideration of the regulatory restrictions in
The rating assignments follow an accepted appeal from Kazkommerts-Policy, in which new material information was provided that enhanced A.M. Best’s opinion of the company’s risk-adjusted capitalisation and subsequently resulted in a change to the original ratings determination.
This press release relates to Credit Ratings that have been published on A.M. Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see A.M. Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Understanding Best’s Credit Ratings.
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