AM Best has affirmed the A- (excellent) credit rating of New Zealand insurer Tower, and its long-term issuer credit rating as a- (excellent). 

The outlook for both is stable.  

Tower’s balance sheet strength is very strong, the ratings agency says, its operating performance adequate, its business profile neutral, and enterprise risk management appropriate. 

Following a dividend payment and share buyback in the first half of fiscal 2025, AM Best expects Tower’s risk-adjusted capitalisation to decline but to “remain at least at the very strong level over the medium term, supported by retention of earnings”.  

Tower’s regulatory solvency capital is expected to maintain a “healthy capital buffer” above the minimum requirements.  

“Other supporting factors include strong financial flexibility, a prudent reinsurance program and a conservative investment strategy,” AM Best says. 

It expects Tower to report positive underwriting and operating results over the medium term, supported by appropriate risk selection, pricing and positive investment returns. 

"Whilst the market share in the overall non-life market is modest at approximately 5%, the company has a solid market position in its core insurance segments in New Zealand,” the ratings agency said.