AM Best Affirms Credit Ratings of Pacific International Insurance Pty Limited

SINGAPORE–(BUSINESS WIRE)–AM Best has affirmed the Financial Strength Rating of B++ (Good) and the Long-Term Issuer Credit Rating of “bbb” (Good) of Pacific International Insurance Pty Limited (Pacific) (Australia). The outlook of these Credit Ratings (ratings) is stable.

The ratings reflect Pacific’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). These ratings also factor in a neutral impact from Pacific’s ultimate owner, Badger Mutual Wealth (Pty) Ltd (the Badger group), an insurance group domiciled in South Africa.

The company’s balance sheet strength assessment is underpinned by risk-adjusted capitalisation, which was at the strong level in fiscal-year ending 30 June 2023, as measured by Best’s Capital Adequacy Ratio (BCAR). Prospective risk-adjusted capitalisation is expected to remain at least at the strong level over the medium term. However, Pacific’s capital adequacy remains sensitive to the successful execution of its business plan, which includes its performance targets and projected capital generation. The company is viewed as having robust financial flexibility, with capital injections totalling AUD 37 million over the last five fiscal years to support the growth of the operation. Prospectively, shareholder support is expected to be forthcoming, if needed. A partially offsetting factor is Pacific’s moderate dependence on reinsurance for new business opportunities; however, the risk associated with this dependence is partly mitigated by the good credit quality of the reinsurance panel.

AM Best views Pacific’s operating performance as adequate. Over the last five years, the company’s operating performance exhibited a notable positive trend, recording a five-year average return-on-equity ratio of -0.2% (fiscal-years 2019-2023). Following the Badger group’s acquisition in fiscal-year 2018, Pacific recorded elevated expenses due to significant investments in marketing and infrastructure. Nevertheless, as a result of increased operational scale and cost saving initiative in recent years, the company reported positive earnings in both fiscal-years 2022 and 2023.

AM Best assesses Pacific’s business profile as limited. This reflects its relatively modest scale of operations. The company recorded elevated premium growth in recent years, with a large proportion of this premium being ceded out to reinsurers. Pacific’s net retained insurance portfolio predominantly consists of motor and a motor novated lease partnership with an insurance distributor. AM Best expects Pacific’s net underwriting growth to be elevated over the medium term, driven by pet cover and travel lines of business.

AM Best assesses Pacific’s ERM as appropriate, given the size, nature and the complexity of its operations. Nonetheless, AM Best views ongoing strengthening of the company’s ERM capabilities as necessary to support its increasing operational scale and widened product offering in the near to medium term.

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 © 2024 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.


Yi Ding
Senior Financial Analyst
+65 6303 5021

Christopher Sharkey
Associate Director, Public Relations
+1 908 882 2310

Michael Dunckley, CFA
Associate Director, Analytics
+44 20 7397 0312

Al Slavin
Senior Public Relations Specialist
+1 908 882 2318

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