AM Best Affirms Credit Ratings of Blue Cross (Asia-Pacific) Insurance Limited

HONG KONG–(BUSINESS WIRE)–#insuranceAM Best has affirmed the Financial Strength Rating of A (Excellent) and the Long-Term Issuer Credit Rating of “a+” (Excellent) of Blue Cross (Asia-Pacific) Insurance Limited (Blue Cross or the company) (Hong Kong). The outlook of these Credit Ratings (ratings) is stable.

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The ratings reflect Blue Cross’ balance sheet strength, which AM Best assesses as very strong, as well as its adequate operating performance, neutral business profile and appropriate enterprise risk management. It also incorporates the rating enhancement that Blue Cross receives from its ultimate parent, AIA Group Limited (AIA).

Blue Cross’ risk-adjusted capitalisation, as measured by Best’s Capital Adequacy Ratio (BCAR), remained at the strongest level as of year-end 2022. The company’s capital and surplus declined in 2022 to HKD 518 million due to the combined result of a net loss and negative fair value reserve changes and the transfer of its residual long-term business to AIA Everest Life Company Limited. Blue Cross’ balance sheet strength is supported by AIA’s capital support, a prudent investment strategy, strong liquidity, low reinsurance dependency and a debt-free balance sheet. AM Best expects Blue Cross’ risk-adjusted capitalisation to remain supportive of the very strong balance sheet strength assessment over the short to intermediate term.

Blue Cross’ operating result in 2022 was impacted negatively by a material one-off loss from discontinued operations and unfavourable investment results. Going forward, the company intends to expand its premium revenue at higher-than-average double-digit growth rates over the short to intermediate term.

Notwithstanding, AM Best expects the company’s earnings to remain marginal in 2022 and 2023 due to elevated levels of operating expenses stemming from integration with AIA. In contrast, the company continues to source profitable and stable investment income from its fixed-income oriented investment portfolio. Overall, AM Best considers Blue Cross’ operating performance to be commensurate with the adequate assessment.

A majority of Blue Cross’ underwriting portfolio comprises individual and group medical insurance. The company was the sixth-largest provider of accident and health products in terms of direct premiums written in 2022. The company distributes its products via a multi-channel strategy, including direct sales, AIA’s agency force, a bancassurance partnership with The Bank of East Asia, Limited and external producers, such as agents and brokers.

Leveraging its established franchise, in particular the medical insurance segment, Blue Cross is expected to play a strategic role in AIA’s integrated health strategy. The company continues to benefit from explicit and implicit support from AIA. In addition to providing capital support, AIA’s expertise and experience in the insurance industry can provide Blue Cross with access to best practices, talent and technologies to improve its operations. AIA’s strong agency force and established network of distribution partners also can enable Blue Cross to expand its customer base and market reach.

Negative rating actions could occur if there is significant deterioration in Blue Cross’ risk-adjusted capitalisation or if the company experiences sustained deterioration in operating performance from adverse deviations in the business plan. Negative rating actions also may result if the credit profile of AIA weakens, or from a reduced level of support from either or a reduction in Blue Cross’ strategic importance and integration to AIA. Positive rating actions could occur if Blue Cross can demonstrate sustained better-than-average operating performance.

Ratings are communicated to rated entities prior to publication. Unless stated otherwise, the ratings were not amended subsequent to that communication.

This press release relates to Credit Ratings that have been published on AM Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best’s Credit Ratings. For information on the proper use of Best’s Credit Ratings, Best’s Performance Assessments, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.

AM Best is a global credit rating agency, news publisher and data analytics provider specialising in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit

Copyright © 2023 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.


James Chan
Director, Analytics
+852 2827 3418
[email protected]

Christopher Sharkey
Associate Director, Public Relations
+1 908 882 2310
[email protected]

Christie Lee
Senior Director, Analytics
+852 2827 3413
[email protected]

Al Slavin
Senior Public Relations Specialist
+1 908 882 2318
[email protected]

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