The rating affirmation followed the placement of the parent company's rating on the CreditWatch list with negative expectations.
In accordance with the base case, S&P Global Ratings believes that the negative information related to the parent company Freedom Holding Corp. will not lead to significant pressure on FFL's competitive position or damage its reputation, and assess the insurance company's capital as sufficient to support further planned business growth.
In addition, the experts of the rating agency note that the regulatory regime in Kazakhstan will continue to exclude the outflow of FFL funds, for example, in the form of dividend payments or large investments, support the parent group. The regulation also implies a constant supervision of the activities of the FFL by the Agency for Regulation and Development of the Financial Market of the Republic of Kazakhstan.
As a result, the agency rates FFL's stand-alone credit profile at three notches above the group's credit profile reflecting the isolated nature of its business.
Azamat Yerdessov, Chairman of the Board of LIC Freedom Life: “Over the 5 years of its activity, LIC Freedom Life has demonstrated tremendous development in the Kazakhstani life insurance market. It is important to note that changes in legislation, such as the introduction of a deferred retirement annuity and tax benefits under the life insurance program, help Kazakhstanis to trust life insurance companies more and use our products as beneficial financial instruments. As of 2023, the educational accumulative insurance product within the framework of the State Education Savings System (SESS) is also one of the new socially important life insurance products provided for by the legislation of the Republic of Kazakhstan.”
Photos are from open sources.
