AM Best has affirmed its financial strength rating of A+ and long-term issuer credit rating of aa- for The Dai-ichi Life Insurance Company, the wholly-owned subsidiary of Dai-ichi Life Holdings which owns TAL.

The rating agency says the assessment is based upon the balance sheet fundamentals and operating performance of the Dai-ichi Life Holdings organisation.

“[Dai-ichi Life Holdings] is the ultimate parent for the entire Dai-ichi organisation,” AM Best says.

“The ratings reflect [Dai-ichi Life Holdings’] balance sheet strength, which AM Best assesses as very strong, as well as its strong operating performance, favourable business profile and appropriate enterprise risk management.”

AM Best says Dai-ichi Life Holdings’ operating performance remained strong and stable amid the Covid-19 pandemic during fiscal year 2021 and over the past five fiscal years the group’s return on equity based on comprehensive income also remained strong with a five-year average of 10%.

“Over the long term, the group’s stable in-force book of its domestic insurance business and a growing overseas insurance business should continue to support its profitability in a sustainable manner,” AM Best says.

“The group also has sought geographic diversification by expanding its overseas insurance business, which contributed 28% of the group’s adjusted net profit in fiscal year 2021.”

Its Australian business TAL expanded its presence last year when it completed its acquisition of Westpac’s life business for a cash consideration of $900 million.

A report last month by research house Dexx&r puts TAL’s total in-force premium at $4.2 billion, ahead of other life insurers.