Min Xin Insurance seen to maintain strong capitalisation

It’s balance sheet strength is supported by its risk-adjusted capitalisation.

Min Xin Insurance's (MXIC) balance sheet was assessed as strong, along with adequate operating performance, limited business profile, and appropriate enterprise risk management, AM Best said.

MXIC’s balance sheet strength is supported by its risk-adjusted capitalisation, which was at the strongest level as of year-end 2023, according to AM Best’s Capital Adequacy Ratio (BCAR). 

The company has achieved significant growth in its capital and surplus (C&S) over the past decade through capital injections from its parent company, Min Xin Holdings Limited (MXHL), and retained net profits. 

Additional strengths include a healthy regulatory solvency position, strong liquidity, and prudent reinsurance arrangements. 

However, these factors are partially offset by investment concentration in a single property and a relatively small C&S size of $40.8m under HKFRS 17.

As a wholly owned subsidiary of MXHL, which is majority-controlled by Fujian Investment & Development Group, a state-owned enterprise of the Fujian provincial government, MXIC benefits from its parent’s financial support. 

Looking ahead, AM Best expects MXIC to maintain its strong capitalisation and continue leveraging its investment and bancassurance strategies to sustain profitability despite challenges in scaling its underwriting performance.