Press Release

VIS Reaffirms IFS Rating of The Co-operative Insurance Society of Pakistan Limited

Lahore, March 5, 2025; VIS Credit Rating Company Limited (VIS) has reaffirmed the Insurer Financial Strength (IFS) rating of The Co-operative Insurance Society of Pakistan Limited (‘CISPL’ or “the Society”) at ‘BB+’ (Double B Plus). The IFS rating of ‘BB+’ denotes marginal capacity to meet policyholders and contract obligations. Though positive factors are present, risk factors are relatively high, and the impact of any adverse business and economic factors is expected to be significant. Outlook on the assigned ratings is ‘Stable’. The previous rating action was announced on January 02, 2024.

The rating of CISPL reflects its constrained business volume and limited ability to fulfill policyholder and contractual obligations. While gross written premium though somewhat increasing over the year, its quantum and the Society's market presence continues to remain limited. Although the net claims ratio has remained low, the Society has consistently incurred underwriting losses due to a persistently high expense ratio.

Despite generating reasonable rental and investment income, CISPL reported loss during 9MCY24 largely due to reduced net insurance premiums. The Society's liquidity position remains sound, with liquid assets well-covered against net technical reserves. Additionally, the proportion of insurance debt to gross written premium has been minimal that is further indicative of adequate liquidity. Both operating and financial leverage levels have remained low. The credit risk associated with the Society's choice of reinsurance panel is considered low, with the reinsurer maintaining an 'AA+' rating. Going forward, ratings are contingent upon improvement in business volume and profitability metrics.

For further information on this ratings announcement, please contact 042-35723411-12 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

Information herein was obtained from sources believed to be accurate and reliable; however, VIS Credit Rating Company Limited (VIS) does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. VIS, the analysts involved in the rating process and members of its rating committee do not have any conflict of interest relating to the rating(s)/ranking(s) mentioned in this report. VIS is paid a fee for most rating assignments. This rating/ranking is an opinion and is not a recommendation to buy or sell any securities. Copyright March 05, 2025 VIS Credit Rating Company Limited. All rights reserved. Contents may be used by news media with credit to VIS.