Press Release
VIS Reaffirms IFS Rating of Pakistan Reinsurance Company Limited
Karachi, February 10, 2026: VIS Credit Rating Company Limited (VIS) has reaffirmed the Insurer Financial Strength (IFS) rating of Pakistan Reinsurance Company Limited (PRCL or ‘the Company’) at ‘AA+ (IFS)’ (Double A Plus IFS). The IFS rating of ‘AA+’ denotes very strong capacity to meet policy holders and contract obligations. Risk factors are very low, and the impact of any adverse business and economic factors is expected to be very small. Outlook on the assigned rating is ‘Stable’. The previous rating action was announced on March 19, 2025.
PRCL is engaged in the provision of reinsurance and re-takaful services in Pakistan. PRCL’s rating reflects its sponsor profile, with 75.4% shares held by the government, either directly or through another state-owned life insurance company. It is the sole reinsurer in the country, with local insurance companies required to offer one-third of their business to PRCL, with a first right of refusal, which underpins business stability.
Gross premium has depicted volatility due to timing of some contracts, though net premium has remained largely stable with some decline in 9MCY25. The Company writes regular business sourced from local insurance companies under treaty arrangement while large specialized risks such as aviation are procured on facultative basis and mostly placed onwards. The risk profile of treaty business, which is about one-third of gross premium, is managed by a strengthened retrocession protection program, with enhanced excess-of-loss and catastrophe covers improving resilience against large losses. Underwriting performance weakened during the review period due to higher claims incidence; overall profitability was supported by a large investment portfolio though yield on the same was lower than relevant market benchmarks.
Governance and regulatory risks have increased during the review period; there has been instability at both the Board and management level with several vacancies still present. In continuation with prior years, the financial statements for the year ended December 2024 were also qualified; the reduction in outstanding balance for unreconciled balances is considered positive.
In terms of financial resilience, liquidity profile is sound and capitalization indicators are also strong; notwithstanding the impact of contingent liabilities pertaining to the on-going tax dispute with the Sindh Revenue Board, the impact of which will be reviewed once the same is finalized and may have larger sector wide implications.
For further information on this rating announcement, please contact 021-35311861-64 or email at info@vis.com.pk
Applicable Rating Criteria: General Insurance
https://docs.vis.com.pk/docs/GeneralInsurance-2023.pdf
VIS Issue/Issuer Rating Scale
https://docs.vis.com.pk/docs/VISRatingScales.pdf