Union Insurance Co. Ltd.

The stable rating outlook on Union Insurance reflects our assessment that the insurer will maintain very strong capital and earnings over the next one to two years. The insurer is likely to maintain an underwriting performance in line with the domestic peers over the same period, given Union Insurance's satisfactory underwriting performance on personal line insurance and its development in commercial line insurance with adequate underwriting skills and reinsurance arrangements. We forecast Union Insurance will maintain a moderate low investment risk appetite with controlled exposure to equities over the next one to two years. We could lower the ratings on Union Insurance if the insurer's financial risk profile deteriorates significantly, possibly due to an aggressive increase in investment risk appetite,

...Union Insurance to maintain its market presence in key product lines. We anticipate Union Insurance Co. Ltd. will maintain its competitiveness in commercial and personal lines in Taiwan's property & casualty (P/C or non-life) insurance market over the next one to two years. However, we believe the insurer remains less geographically diverse than its regional peers. We project the insurer's operating performance will remain in line with the domestic norm. Union Insurance's operating performance is likely to remain satisfactory over the coming two years, which is about the industry average in Taiwan. we base this forecast on the insurer's quality control in business strategies, prudent underwriting management, and adequate reinsurance arrangements. Union Insurance's capital remains a strength. Our risk-based capital model indicates that Union Insurance's capital adequacy is excellent and unlikely to weaken over the coming two years. The insurer's satisfactory operating performance and prudent...

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