Press Release

VIS Reaffirms IFS Rating of EFU General Insurance Limited

Lahore, February 19, 2025: VIS Credit Rating Company Limited has reaffirmed the Insurer Financial Strength (IFS) Rating of EFU General Insurance Limited (EFUG or ‘the Company’) at ‘AA++ (IFS)’ (Double A Plus Plus (IFS)). The IFS rating of ‘AA++(IFS)’ 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 January 3, 2024.

The rating assigned to EFUG take into account its prominent market position as the leading general insurance company in the country. The rating derives strength from the overall sound profile of the EFU Group along with sponsorship backing of Bhimjee family and Jahangir Siddiqui & Co. Ltd. Despite reduction in the market share during the ongoing year, the gross written premium (GWP) witnessed an uptick over the rating review period driven mainly by upward revision in premium prices in line with inflationary pressures. Additionally, underwriting performance depicted noteworthy recovery on a timeline owing to improvement in net claims ratio. Despite an increase in underwriting expenses, the net profit was supported by a rise in investment income, lower claims ratio and robust profits from takaful operations.

Rating reflects the overall risk profile being supported by sound reinsurance arrangements with reputed international reinsurers. The liquidity profile is considered satisfactory as exhibited by liquid asset coverage of net technical reserves and insurance debt relative to gross premium. Capitalization profile of the Company is sound, given growth in equity base despite significant dividend payout. Operating and leverage indicators treaded upwards but remain aligned with the peer median. Going forward, recovery of market share and maintenance of profitability metrics, will be vital from a rating’s perspective.

For further information on this ratings announcement, please contact 042-35723411-13 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

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