Allianz Jingdong General Insurance, based in China, is set to enhance its profitability over the next two years, focusing on refining its underwriting risk selection and controlling operational expenses, according to Fitch Ratings.
The ratings agency anticipates that the insurer’s financial performance will continue to improve, supported by its strategic role within the Allianz Group. Despite modest capital reserves, the insurer is expected to maintain stable credit fundamentals.
In 2024, Allianz Jingdong reported a return on equity (ROE) of 6.5%, a significant increase from 2.4% in 2023, bringing the three-year average ROE to 2.5%. The company’s combined ratio also showed slight improvement, reaching 103% in 2024, compared to 104% the previous year.
Fitch notes that while the insurer’s capitalization remains adequate, the capital buffer is considered modest. Investment risk is expected to remain low, with the Fitch-adjusted risky-assets ratio declining to 45% in 2024 from 47% in 2023, staying well below the threshold for its current rating level.
Allianz Jingdong has also reduced its exposure to insurance asset-management products, shifting toward higher-yielding debt schemes. While equity-type investments increased, they remained limited. Fitch expects the insurer to maintain a cautious approach toward managing counterparty and liquidity risks moving forward.
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