Pinnacle Life gains stable outlook on strong capital position

Operating performance is forecast to remain adequate.

Pinnacle Life Limited will likely have a stable outlook due to continued balance sheet strength and adequate operating performance as the company pursues its expansion strategy, AM Best said.

The New Zealand-based insurer’s risk-adjusted capitalisation remained at the strongest level at the end of fiscal year 2024, based on Best’s Capital Adequacy Ratio (BCAR), and is expected to stay at this level over the medium term. 

This is despite the company’s high reliance on third-party reinsurance and a small capital base, which increases its exposure to interest rate fluctuations, rapid business growth, and market shocks.

Operating performance is forecast to remain adequate, supported by solid underwriting growth and a pricing strategy aligned with the company’s risk profile. 

AM Best noted that Pinnacle Life’s historical earnings have shown moderate volatility due to interest rate changes and elevated expenses, but its current execution plan is expected to maintain performance within a stable range. 

The insurer also benefits from the underwriting and product development expertise of its ultimate parent, Greenstone Holdco Pty Limited.