The credit rating of SOGAZ INSURANCE (hereinafter, SOGAZ) is based on the Company’s very strong business and financial profiles and adequate management quality.
The rating is backed by the strong market position, comfortable operating indicators, and high assessments of capital adequacy, asset quality, and liquidity. Additional positive influence comes from the assessment of the relationship with one of its shareholders and largest customer.
SOGAZ is the head company of SOGAZ Insurance Group (hereinafter, the Group), which offers insurance programs for individuals and businesses in various fields of activity, including systemically important Russian corporations and their employees.
key assessment factors
The very strong business profile takes into account the Group’s strong market positions and comfortable operating indicators. The Group remained one of the leaders of the Russian insurance market in 2024. The Group’s market share is 13.5% according to data for 2024. SOGAZ Group holds strong positions in the voluntary medical insurance and corporate property insurance segments — 30% and 46% of the market, respectively. The growth in premiums in 2024 was mainly due to the growth in life insurance. At the same time, the assessment of the diversification of the Group’s client base increased due to a decrease in the share of premiums from large corporate clients. The Agency assesses the quality of SOGAZ’s product range as high in view of the Group’s ability to meet its customers’ needs for insurance protection against major property risks and its experience in the field of employee health insurance. The structure of distribution channels is dominated by direct sales (45%) and the banking channel (38%).
ACRA assumes that in the medium term, the Group is able to maintain the average market growth rate by holding on to its existing market share. The combined loss ratio (CLR) exceeded one in 2024. At the same time, the Agency expects the CLR to decline to less than one in 2025 and then stay within a comfortable range. Return on life insurance assets in 2024 was around 3%.
The very strong financial profile is underpinned by the Group’s high capitalization and conservative investment policy. The ratio of available capital to capital at risk, calculated according to ACRA’s methodology as of December 31, 2024, was 3.7, which contributes to the high capital adequacy of SOGAZ.
The average indicator of asset quality continues to be high because the Group invests primarily in low-risk assets. At the same time, the Agency notes the heightened concentration of assets — the 10 largest groups of related counterparties accounts for around 65% of total assets, which is calculated in accordance with the requirements for the financial stability and solvency of insurers approved by the Bank of Russia.
The strong liquidity position is determined taking into account the short-term and long-term liquidity ratios of 2.7 and 1.5, respectively.
Management quality is assessed as adequate based on positive assessments of management experience and structure, as well as the actuarial function. When determining the final level of the credit rating, ACRA also made a positive adjustment to the standalone creditworthiness assessment (SCA), taking into account SOGAZ’s sustainable competitive advantage associated with the relationship with one of its shareholders and its largest customer.
key assumptions
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Retaining market share and leadership in the corporate insurance sector;
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Maintaining the conservative investment policy;
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Major shareholders retaining their shareholdings in SOGAZ.
potential outlook or rating change factors
The Stable outlook assumes that the rating will highly likely stay unchanged within the 12 to 18-month horizon.
A negative rating action may be prompted by:
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Lower business performance indicators;
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Lower assessment of asset quality;
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Worse assessment of the relationship with the largest client.
rating components
SCA: аа+.
Adjustments: additional adjustment — SCA plus two notches.
issue ratings
There are no outstanding issues.
regulatory disclosure
The credit rating has been assigned under the national scale for the Russian Federation based on the Methodology for Assigning Credit Ratings to Insurance Organizations on the National Scale for the Russian Federation and the Key Concepts Used by the Analytical Credit Rating Agency within the Scope of Its Rating Activities.
The credit rating of SOGAZ INSURANCE was published by ACRA for the first time on July 5, 2017. The credit rating and its outlook are expected to be revised within one year following the publication date of this press release.
The credit rating was assigned based on data provided by SOGAZ INSURANCE, information from publicly available sources, and ACRA’s own databases. The rating analysis was performed using the GAAP and IFRS financial statements of SOGAZ INSURANCE. The credit rating is solicited and SOGAZ INSURANCE participated in its assignment.
In assigning the credit rating, ACRA used only information, the quality and reliability of which were, in ACRA’s opinion, appropriate and sufficient to apply the methodologies.
ACRA provided additional services to SOGAZ INSURANCE. No conflicts of interest were discovered in the course of credit rating assignment.
