AMSTERDAM–(BUSINESS WIRE)–AM Best assigned a financial strength rating of A+ (Superior) and a long-term credit rating of “aa-” (Superior) to AXA SA (AXA) (France) and its subsidiary, AXA France Vie (France). The outlook attributed to these Credit Ratings (ratings) is stable. AXA SA is the main operational holding company of the AXA group and operates as the group’s internal reinsurer following the obtaining of its reinsurance license by its regulator (ACPR, Prudential Control and Resolution Authority) on May 10, 2022, and its merger with AXA Global Re on June 30, 2022. AM Best withdrew its rating from AXA Global Re following the merger.
The ratings reflect the strength of AXA’s balance sheet, which AM Best assesses as very strong, as well as its solid operating performance, very favorable business profile and very good management of business risks.
AXA France Vie’s ratings reflect the strategic importance of the entity for the AXA group as the main operator of life and health insurance in France.
AXA’s balance sheet strength is underpinned by its highest risk-adjusted consolidated capitalization, as measured by Best’s Capital Adequacy Ratio (BCAR). The valuation takes into account the group’s strong earnings generation and prudent capital management. Financial flexibility is considered excellent, demonstrated by the group’s good access to capital markets. A partially offsetting factor in the valuation is AXA’s reliance on softer capital components to support its capital position, including hybrid debt and in-force life business value.
AXA has a track record of strong operational performance, supported by its diversified earnings profile. The group produced a five-year weighted average return on equity ratio of 6.2% (2017-2021), as calculated by AM Best. Performance indicators include exceptional charges related to the group’s restructuring in 2018. In 2021, AXA recorded a solid net income of 7.3 billion euros, compared to 3.2 billion euros in 2020. The improvement was driven by improving technical results, with 2020 results depressed by the effects of the COVID-19 pandemic on non-life lines.
AXA is one of the largest insurance groups in the world, with significant diversification by line of business and geography, and leading positions in many developed and emerging markets. The group offers a full range of life, health and non-life insurance products, as well as asset management services. Its competitive position is supported by its size and strong brand.
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