RAM Ratings, the local subsidiary of RAM Holdings Berhad, an affiliate of Standard & Poor, has assigned a claims paying ability rating of AA- (with a stable outlook) to Sri Lanka Insurance Corporation Ltd (SLIC).
SLIC said in a statement that the rating is supported by the company’s strong competitive position and unparalleled capitalization as well as the size and strength of its balance sheet. SLIC is considered the oldest and largest (in terms of the size of the balance sheet) Insurer in Sri Lanka. SLIC quotes RAM as saying that the company enjoys ample financial flexibility due to its robust balance sheet.

SLIC says it manages a diversified investment portfolio valued at Rs. 30 billion – the largest in the industry. SLIC also possesses good underwriting capabilities in 3 major classes of Non Life. Nonetheless, its overall underwriting standards vis-à-vis General Insurance are tempered by the high claims incidence in the “All Risk” category, which falls under the miscellaneous class of insurance.

It said the company has been maintaining solvency margins of 5.63 times and 4.88 times respectively for the life and general segments. Even though these levels may narrow slightly due to increased investments in equities and corporate debts, RAM ratings expect SLIC to be able to keep its solvency margin above the statutory minimum.