Fitch Ratings has affirmed Bupa Insurance financial strength rating at ‘A+’ with a stable outlook.
The rating rationale primarily reflects Bupa’s strong and stable underwriting profitability, which has held up comparatively well despite the challenging economic environment; solid capitalisation that is supportive of the current rating level; strong franchise and leading market position in the UK; and the low risk nature of the short-tail medical insurance class of business which can be re-priced in a timely manner in response to a deterioration in profitability. Offsetting these positives is the company’s reliance on a single line of business.
Given the company’s current lack of business line diversification evident in its almost complete reliance on medical insurance, Fitch does not anticipate an upgrade in the near future.
Private medical insurance news: 18 May 2011