AM Best expects MS First Capital to sustain profitability

AM Best expects MSFC’s operating performance to stay solid.

MS First Capital Insurance Limited (MSFC) is expected to maintain strong capitalisation and steady profitability over the medium term, supported by consistent internal capital generation and a conservative investment approach, according to AM Best.

The rating agency said MSFC’s balance sheet fundamentals have strengthened, backed by prudent capital management and robust earnings. 

The company’s risk-adjusted capitalisation, measured by Best’s Capital Adequacy Ratio, was at the strongest level at the end of 2024 and is projected to remain so in the coming years. 

Shareholders’ equity rose to $1.08b (S$1.4b) at end-2024 from $386.78m (S$501.1m) a decade earlier.

AM Best expects MSFC’s operating performance to stay solid, driven by disciplined underwriting and stable investment returns. 

The insurer posted a return-on-equity ratio of 14.2% in 2024, supported by gains from both underwriting and investment operations. 

The company’s investment portfolio remains conservative, consisting mainly of cash, term deposits, and high-quality bonds.

Whilst MSFC continues to rely heavily on reinsurance to manage large-risk and catastrophe exposures, AM Best noted that the credit risk is partly mitigated by the strong financial standing of its reinsurance partners.

($1.00 = S$1.30)