AM Best maintains credit rating of Consumer Insurance Services Limited

AM Best maintains credit rating of Consumer Insurance Services Limited | Insurance Business New Zealand

AM Best maintains credit rating of Consumer Insurance Services Limited

       Global rating agency AM Best has reaffirmed the financial strength of Consumer Insurance Services Limited (CISL) with a B+ (Good) and its long-term issuer credit rating of bbb- (Good).

The credit ratings remain unchanged even after the ultimate parent company of CISL, Humm Group, had entered a binding agreement to sell its consumer finance business to Latitude Group Holdings Limited in February.

The combination of Humm Group with Latitude Group will put the former in a stronger position to build on its achievements and accelerate the execution of its growth strategies in Australasia.

The consumer finance business includes its buy-now-pay-later, installment and credit card operations in Australia and New Zealand, while CISL provides credit card repayment protection insurance for Humm group’s cardholder customers in New Zealand.

CISL’s insurance operations are currently in the run-off as it plans to cancel its existing card repayment insurance policies from July 1 onwards. In addition, the company will also give up its insurance license in early 2023.

Although the transaction is still subject to shareholder and regulatory approvals, CISL’s rating fundamentals are not be impacted for now. However, AM Best said it would continue to monitor the transaction and consider any impact on CISL’s rating fundamentals moving forward.