CMB Wing Lung gains support from China Merchants Group

AM Best sees its balance sheet boosted by strong risk-adjusted capitalisation.

CMB Wing Lung Insuranc’s (CMBWLI) enterprise risk management programme is to benefit from additional resources and oversight from its parent, China Merchants Group Limited (CMG), AM Best forecasted.

CMBWLI is a significant player in Hong Kong's non-life insurance market, AM Best said, particularly in the employees' compensation segment. Its product mix diversified further in 2023 with a stronger presence in the marine segment post the CMI acquisition. 

Risk management has been strengthened over recent years, with continued enhancements in investment risk controls and governance. 

In December 2022, CMBWLI completed a business transfer transaction, acquiring the general insurance business of China Merchants Insurance Company Limited (CMI) through additional share issuance. 

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Subsequently, China Merchants Insurance Holdings (CMIH) injected HK$1.2b into CMBWLI, making CMIH the majority shareholder with a 55% stake, whilst China Merchants Bank Co. (CMB) holds the remaining 45%. 

CMBWLI's balance sheet strength is bolstered by robust risk-adjusted capitalisation, evidenced by its growing capital base and positive operating results.

Total capital and surplus increased by 88% to HK$3b in 2023. Operating performance remained strong, with annualised returns on equity of 8% and 9% in 2022 and 2023, respectively, supported by premium growth and profitable underwriting.