AM Best Revises Outlooks to Positive for Well Link Life Insurance Company Limited

HONG KONG--(BUSINESS WIRE)--AM Best has revised the outlooks to positive from stable and affirmed the Financial Strength Rating of B+ (Good) and the Long-Term Issuer Credit Rating of “bbb-” (Good) of Well Link Life Insurance Company Limited (Well Link Life) (Hong Kong).

The Credit Ratings (ratings) reflect Well Link Life’s balance sheet strength, which AM Best assesses as strong, as well as its marginal operating performance, limited business profile and appropriate enterprise risk management (ERM).

The outlook revisions to positive from stable reflect AM Best’s expectation that Well Link Life will demonstrate a trend of stabilising and positive operating results with prospects for sustained improvement over the short to intermediate term, based on its business plan. Well Link Life has achieved substantial premium growth over the past three years, benefiting from strong sales momentum of long-term participating saving products, which also contributed to higher value of new business. Investment returns were favourable in 2024, with an expected double-digit net investment yield in 2025, supported by stronger income sourced from an enlarged diversified portfolio of higher credit quality fixed-income securities and listed equities. Operating efficiency has improved through digitalisation and system automation, evidenced by a declining indirect sales-related expense ratio.

Well Link Life’s strong level of balance sheet strength is underpinned by its risk-adjusted capitalisation being assessed at the strongest level as of year-end 2024, as measured by Best’s Capital Adequacy Ratio (BCAR). AM Best expects Well Link Life’s risk-adjusted capitalisation to remain supportive of its balance sheet strength assessment in 2025. However, the company’s risk-adjusted capitalisation is likely to face downward pressures from 2026 onward due to the planned new business premium inflow and heightened asset risks, despite being partially offset by the loss-absorbing capacity of its participating policies. Well Link Life has achieved substantial growth in its investment portfolio, which comprised an increased proportion of fixed-income securities with higher credit ratings, while maintaining a narrow duration gap between its asset portfolio and policy liabilities. Liquidity remains strong.

Well Link Life started operating life insurance business in Hong Kong since April 2019, with participating saving, endowments and qualified deferred annuity products (QDAP) as its major offerings. The company has established distribution partnerships with a network of brokers and an online platform to serve customer needs. Well Link Life’s individual life new business market share grew to 2.0% by direct written premium in the first half of 2025, and it ranked 12^th among Hong Kong-based life insurers, predominantly driven by the strong sales of long-term participating products through the broker channel. AM Best assesses Well Link Life’s ERM as appropriate for the company’s risk profile.

Positive rating actions could occur if Well Link Life demonstrates a sustained and profitable operating performance, while maintaining supportive balance sheet strength fundamentals. Negative rating actions could occur if the company’s balance sheet strength materially weakens such that it no longer supports the current ratings, for example, due to adverse deviations from business projections, leading to significant deterioration in risk-adjusted capitalisation. Although deemed unlikely in the near term, positive rating actions also could occur if Well Link Life further strengthens its market presence without unfavourable deviations from its business plans, while maintaining supportive balance sheet strength and operating performance.

Ratings are communicated to rated entities prior to publication. Unless stated otherwise, the ratings were not amended subsequent to that communication.

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AM Best is a global credit rating agency, news publisher and data analytics provider specialising in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.

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