Fitch Ratings has affirmed its insurer financial strength rating for MARAC Insurance Limited (MIL) at “BB+” with a stable outlook, and simultaneously withdrawn that rating

According to Fitch, it withdrew its rating due to commercial reasons, with the company in run-off status.

The rating reflected MIL’s business profile, which Fitch ranked as “Least Favourable” compared to other insurers in New Zealand. Following the end of its distribution agreement with its parent, Heartland Bank, in January, MIL stopped underwriting new policies. MIL only offered two products, one each in the life and non-life segments. Fitch said it believes Heartland Bank will be able to facilitate an orderly and effective run-off of MIL’s existing portfolio.

For the year ended June 2020, MIL’s capitalisation was rated by Fitch at “Extremely Strong”, with its regulatory solvency ratio at 129%, above the regulatory minimum of 100%.

Following the rating withdrawal, Fitch will no longer be providing the associated ESG Relevance Scores for MIL.