Press Release
JCR-VIS upgrades IFS rating of The Pakistan General Insurance Company Limited to BBB with Stable outlook
Karachi, October 6, 2008: JCR-VIS Credit Rating Company Limited (JCR-VIS) has upgraded the Insurer Financial Strength (IFS) rating of The Pakistan General Insurance Company Limited (PGICL) from ‘BB+’ (Double B Plus) to ‘BBB’ (Triple B). Outlook on the rating is ‘Stable’.
The upgrade takes into account the consistent growth in premium posted by PGICL. Strong underwriting performance was exhibited in a contained claims ratio and underwriting expense ratio. Motor portfolio, which is generally prone to higher rate of claims, has been maintained within prudent limits. Also adding to improved performance is the company’s decision to optimize its network size by decreasing the number of branches. The company has a diverse panel of re-insurers, with Labuan Re being the lead reinsurer. Treaty limits are also adequate, given the size of risks underwritten by the company.
Insurance debt had been maintained at low levels, though there was some increase at the close of FY2007. Investment income has historically provided little support to profitability. The investment strategy was revised during 2007 as additional exposure in real estate was taken and the management is projecting increased income thereon in the current year. For the on-going financial year 2008, the company has initiated a joint audit which is likely to improve the quality of financial reporting.
For further information on this rating announcement, please contact Syed Ziauddin Ahmed (Ext: 508) or Ms. Sobia Maqbool (Ext: 506) at 5311861-71 or fax to 5311872-3.
Faheem Ahmad
President & CEO