SAIC Motor Insurance Limited expects moderate underwriting losses during its start-up phase due to upfront operating expenses, although the captive insurer forecasts a turnaround within its first five years of operation, according to an AM Best commentary.
The ratings agency has assigned the Hong Kong-based insurer a Financial Strength Rating of A- (Excellent) and a Long-Term Issuer Credit Rating of “a-” (Excellent), both with stable outlooks.
During its start-up phase, the insurer will focus on underwriting individual motor liabilities for SAIC Motor-produced vehicles, including motor extended warranty, product replacement coverage and expense reimbursement insurance, while also retaining selected group-related commercial risks.
AM Best said the company’s overall operational and business execution risks are manageable, supported by management experience, underwriting know-how and data accumulated from its key business lines.
The insurer expects its bottom line to be supported largely by investment income, generating an average mid-to-low-single-digit return on capital and surplus over the next five years.
AM Best assessed the company’s balance sheet strength as “very strong”, supported by an initial capital base of USD49m and risk-adjusted capitalisation, as measured by Best’s Capital Adequacy Ratio (BCAR), which is projected to remain at the strongest level under its initial five-year plan covering 2026 to 2030.
The ratings agency also cited low underwriting leverage, a prudent investment portfolio, strong liquidity and appropriate reinsurance considerations as supporting factors.
SAIC Motor Insurance was incorporated in Hong Kong in 2025 as a single-parent captive insurer of SAIC Motor Corporation Limited, China’s largest state-owned motor manufacturer.
SAIC Motor is majority owned by Shanghai Automotive Industry (Group) Co., Ltd., which is wholly owned by the Shanghai municipal government. The insurer serves as the group’s dedicated risk management and insurance arm.
The rating assignment comes as Hong Kong continues to expand its captive insurance sector. SAIC Motor Insurance received authorisation from the Hong Kong Insurance Authority in 2025, joining a growing number of captive insurers establishing operations in the territory as regulators seek to develop Hong Kong as a regional captive insurance hub.
