PICC Group's sole overseas entity enhances PICC HK

Last year PICC HK returned to profitability.

AM Best assessed the People’s Insurance Company of China (Hong Kong) (PICC HK)’s  balance sheet strength as solid, alongside an adequate operating performance, limited business profile and appropriate enterprise risk management.

These elements also highlighted its strategic importance to its parent company, The People’s Insurance Company (Group) of China (PICC Group), as the sole overseas insurance entity.

PICC HK’s risk-adjusted capitalisation, measured by Best’s Capital Adequacy Ratio (BCAR), remained at the strongest level at the end of 2023. Its diversified investment portfolio, with assets in investment-grade bonds, cash, cash equivalents, preference shares, listed equities, and other investments, supports strong liquidity. 

The company maintains a strong regulatory solvency position under both the legacy Hong Kong Insurance Ordinance and the new risk-based capital regime.

In 2023, PICC HK returned to profitability with net earnings driven by robust investment income and positive underwriting results from its inward business. 

Despite a modest presence in Hong Kong’s domestic market, the company has expanded its inward reinsurance portfolio with a higher retention ratio, diversifying its business sources. 

The Macau branch, established in 2022, meets insurance demand from Portuguese-speaking countries and provides general insurance solutions across mainland China’s Greater Bay Area, Hong Kong, and Macau.

As the sole overseas insurance entity for PICC Group, PICC HK benefits from both implicit and explicit support, including multiple capital injections, the latest being HK$970m in December 2020. 

It also gains operational synergies in underwriting, investment management, and risk management.