Non-Life Insurers in Asia-Pacific Show Strong Credit Fundamentals

Fitch Ratings: Non-life insurers in the Asia-Pacific (APAC) region continue to outpace their global counterparts, showcasing strong credit fundamentals. According to a recent analysis, APAC insurers were evaluated against large international operators and firms from the US and EMEA regions, underscoring their robust profiles.

APAC insurers maintain high company profile standards, bolstered by substantial market positions and diversification across various business lines and geographies. Fitch has ranked these profiles in the ‘Favourable’ to ‘Most Favourable’ range, equivalent to the ‘aa’ category in the Fitch rating system.

Capital strength is a key highlight, with insurers maintaining solid capitalisation and manageable leverage. Prism Global scores range from ‘Strong’ to ‘Extremely Strong’, while regulatory solvency ratios align with ‘A’ to ‘AAA’ categories, adhering to Fitch’s insurance rating criteria.

Fitch anticipates robust economic solvency from companies like Tokio Marine & Nichido Fire Insurance, Sompo Japan, and Mitsui Sumitomo Insurance, aligning with Japan’s economic value-based solvency regime (J-ICS) by March 2026.

Profitability across the peer group is assessed as ‘Strong’ to ‘Very Strong’. Challenges include claim inflation, rising reinsurance costs, and catastrophe-related losses, but enhanced reinvestment yields have favorably impacted earnings. Leading Japanese insurers have improved financial results from strategic equity divestitures and consistent underwriting gains abroad.

Investment risk exposure among Japanese insurers has a moderate impact on ratings, with a noted reduction in high-risk assets due to strategic sales of domestic equities to meet regulatory expectations.

In June 2025, Fitch upgraded QBE Insurance Group, citing financial performance improvements and strengthened capital. This upgrade reflects QBE's enhanced underwriting outcomes driven by premium increases and strategic plans to stabilize earnings.