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AM Best Upgrades Credit Ratings of Halyk-Life, JSC

AM Best has upgraded the Financial Strength Rating to B++ (Good) from B+ (Good) and the Long-Term Issuer Credit Rating to “bbb” (Good) from “bbb-” (Good) of Halyk-Life, Life Insurance Subsidiary Company of the Halyk Bank of Kazakhstan, JSC (Halyk-Life) (Kazakhstan). Halyk-Life is a wholly owned subsidiary of JSC Halyk Bank (Halyk Bank), a leading retail bank in Kazakhstan. The outlook of these Credit Ratings (ratings) has been revised to stable from positive.

The ratings reflect Halyk-Life’s balance sheet strength, which AM Best assesses as very strong, as well as its strong operating performance, limited business profile and marginal enterprise risk management.

The rating upgrades reflect improvements in Halyk-Life’s operating performance in recent years, supported by solid investment returns, although this should be viewed in the context of the relatively high inflationary environment in Kazakhstan. In 2022, the company reported an increase in return on equity to 35.6% (2021: 21.8%), as calculated by AM Best, largely driven by lower commission rates in the bancassurance portfolio. AM Best expects Halyk-Life to continue this trend of strong operating results prospectively, underpinned by the profitable growth of its life and annuity book and the actions that the company has taken to reduce its operating expenses. However, future results could be challenged by the intense competition in the Kazakh life insurance market and the high regulatory risk environment in the country, which could cause top-line volatility.

Halyk-Life’s balance sheet strength is underpinned by its risk-adjusted capitalisation, which is assessed at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR), based on audited year-end 2022 IFRS financial statements. AM Best expects the company’s BCAR to remain at the strongest level prospectively, driven by solid operating results and a dividend policy that allows for sufficient earnings retention to support its growth plans.

Halyk-Life’s investment portfolio is relatively conservative by asset class, with fixed-income securities, cash and bank deposits accounting for approximately 93% of its investments at year-end 2022. Over 80% of the company’s fixed-income holdings are investment-grade securities. The ratings also factor in Halyk-Life’s exposure to the high levels of economic, political and financial system risks associated with operating predominantly in Kazakhstan.

Halyk-Life is a leading insurer in Kazakhstan’s life insurance market, with an estimated market share of 33%, based on 2022 gross written premium. However, Halyk-Life’s operations are limited to its domestic insurance market, which is small by international standards. Over the recent years, the company has become less dependent on third-party distribution channels, given its ability to leverage the relationship with its parent, Halyk Bank, which is viewed by AM Best as positive.

This press release relates to Credit Ratings that have been published on AM Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best’s Credit Ratings. For information on the proper use of Best’s Credit Ratings, Best’s Performance Assessments, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.

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

Copyright © 2023 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.


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