Moody's Investors Service on Friday upgraded to A3 from Baa1 the insurance financial strength rating (IFSR) of Kuwait Insurance Company S.A.K. (KIC). The rating carries a stable outlook.

According to Moody’s, the rating upgrade reflects the company’s strong position in the domestic market with an established brand and a good reputation for service. It also shows KIC’s sustained strong bottom line profitability with a 5 year average return on capital (ROC) of 8.5% and a very high sharp ratio of return on capital, which measures the very strong consistency of returns on a 5 year average basis.

Furthermore, underwriting performance was good with a 5 year average combined ratio (COR) of 82.9% in 2014 (all on a Moody's basis) coupled with a conservative reserves policy.

“KIC's strong domestic market position, focus on service and longstanding relationships with key departments and businesses in Kuwait demonstrate that the company is well placed to secure a significant proportion of the contracted insurance stemming from the upcoming government stimulus package,” said Moody’s.