Co-op Life benefits from favourable underwriting results

AM Best expects continued robust pricing and positive investment income.

New Zealand-based Co-operative Life Limited’s balance sheet strength remained adequate, bolstered by strong risk-adjusted capitalisation as of 31 March, and a conservative investment strategy focusing on cash and high-quality fixed-income securities, AM Best said.

However, the company's small capital base increases its sensitivity to stress scenarios.

Co-op Life has consistently delivered strong operating performance, recording a return on equity of 16.9% in fiscal year 2024, driven by favourable underwriting results and a low expense ratio from its bancassurance distribution model. 

AM Best expects continued robust pricing and positive investment income.

Despite its strong performance, Co-op Life has a limited business profile, with a market share of less than 1% in New Zealand's life insurance industry and a narrow product range focused on term life and loan protection insurance. 

The company leverages its parent, The Co-operative Bank's network, although it maintains a low customer penetration rate.