Press Release
JCR-VIS Reaffirms IFS Rating of UBL Insurers Limited
Karachi, September 19, 2011: JCR-VIS Credit Rating Company Limited has reaffirmed the Insurer Financial Strength rating of UBL Insurers Limited (UIL) at ‘A’ (Single A). Outlook on the assigned rating is ‘Stable’.
The rating derives strength from the financial strength of major sponsors of the company, as also evidenced by the recent capital injection of Rs. 300m in the institution. Leverage indicators of the company are considered within prudent limits. Moreover, liquidity profile of the company is also considered sound.
The unprecedented floods in 2010 adversely affected underwriting results of the company. Even though the magnitude of losses has reduced, combined ratio has remained in excess of 100%. The management has targeted 2011 to be a fully profitable year. Various measures were taken in 2010 to rationalize operating expenses, translating into a lower expense ratio for the year. For 2011, while enhanced support is expected from investment income, given the restructuring of investment portfolio, key risk to future profitability stems from some areas of the underwriting operations. Given the spate of recent events, underwriting performance of fire, crop loan insurance and bankers’ blanket business may remain under pressure in the on-going year as well.
For further information on this rating announcement, please contact the undersigned (Ext: 508) or Ms. Sobia Maqbool, CFA (Ext: 506) at 021-35311861-70 or fax to 021-35311872-3.
Syed Ziauddin Ahmed
Advisor