Beneficial Insurance Limited has had its financial strength rating of B++ (Good) and its long-term issuer credit rating of “bbb” affirmed by A.M. Best. The outlook of the credit ratings is stable.

According to A.M. Best, the rating action reflects Beneficial Insurance’s adequate balance sheet strength, strong operating performance, limited business profile and appropriate enterprise risk management.

“Over the medium term, A.M. Best expects the company’s planned high level of underwriting growth to drive a notable increase in net required capital,” the ratings agency said. “However, strong internal capital generation is expected to enable it to maintain at least very strong risk-adjusted capitalisation.”

A.M. Best views Beneficial Insurance’s business profile as limited given its small scale of operations, limited product and geographic diversification in New Zealand. The company’s largest line of business is pet insurance, which currently accounts for more than 90% of gross written premiums.

The company’s motor breakdown insurance and consumer credit insurance are expected to grow over the long term but presently remain a small component of the company’s portfolio, the ratings agency added.