The rating on Hang Seng Insurance Co. Ltd. (Hang Seng Insurance) reflects the company's good market position and strong distribution benefits derived from being owned by Hang Seng Bank Ltd. (Hang Seng Bank; AA/Positive/A-1+). The rating is also supported by the company's consistently strong operating performance, strong capitalization, and conservative investment portfolio. These positive factors are counterbalanced by its small market share in a competitive industry where premium rates have been falling, and this is partly reflected in a high expense base. Hang Seng Insurance's parent, Hang Seng Bank, is 62.14% owned by Hongkong and Shanghai Banking Corp. Ltd. (HSBC; AA/Positive/A-1+). Together with its sister company, Hang Seng Life Ltd. (A+/Stable/--), Hang Seng Insurance forms the insurance arm of Hang
