NZMII Credit Ratings Affirmed Good By AM Best

KUALA LUMPUR, May 4 (Bernama) -- Global credit rating agency, AM Best has affirmed the financial strength rating of B+ (Good) and the long-term issuer credit rating of “bbb-” (Good) of New Zealand Medical Indemnity Insurance Limited (NZMII), with a stable outlook for these credit ratings (ratings).

The ratings reflect NZMII’s balance sheet strength, which AM Best assesses as adequate, as well as its adequate operating performance, limited business profile and appropriate enterprise risk management (ERM).

NZMII’s balance sheet strength is underpinned by its risk-adjusted capitalisation, which was at the strongest level as of March 31, 2025 (fiscal year-end 2025), as measured by Best’s Capital Adequacy Ratio. It is also supported by a conservative investment portfolio consisting mainly of cash and fixed-income securities.

Prospective risk-adjusted capitalisation remains sensitive to the pace of its business growth and the size of future dividend distributions, according to AM Best in a statement.

NZMII’s operating performance is assessed as adequate, supported by a return-on-equity ratio of 13.9 per cent and a net/net combined ratio of 80.2 per cent in fiscal year 2025. Earnings are supplemented by investment income, with a net investment yield (including gains) of 4.4 per cent.

AM Best assesses NZMII’s business profile as limited, given its position as a small, niche insurer in New Zealand focused on medical indemnity coverage for healthcare professionals. As a monoline insurer operating in a single country, NZMII has limited geographic and product diversification, although access to new business is supported by its affiliation with the New Zealand Resident Doctors’ Association.

NZMII’s ERM is assessed as appropriate, taking into account the size and complexity of its operations. While the company has moderate exposure to operational risks due to reliance on third-party service providers, these risks are partially mitigated through the use of established providers and contractual safeguards.

-- BERNAMA