Press Release

JCR-VIS Reaffirms IFS Rating of Security General Insurance Company Limited

Karachi, December 28, 2018: JCR-VIS Credit Rating Company Limited (JCR-VIS) has reaffirmed the Insurer Financial Strength (IFS) rating of Security General Insurance Company Limited (SGICL) at ‘AA’ (Double A). The IFS rating of ‘AA’ denotes very high capacity of meeting policy holder and contractual obligations. Moreover, the risk is modest, but may vary slightly with possible changes in economic conditions. Outlook on the assigned ratings is ‘Stable’. The previous rating action was announced on September 14, 2017.

Ratings assigned to SGICL take into account its association with a large diversified conglomerate “Nishat Group” having business interests in banking, textile, cement, power generation, real estate and paper products. Ratings draw strength from growth in business volumes, improved underwriting results and conservative risk appetite leading to cautious business selection. The sound capitalization and leverage indicators exhibiting strong loss absorption capacity remain the key rating driver. Credit risk emanating from reinsurance panel selection remains sound with all reinsurers, except one, rated in category ‘A’ or higher. The ratings also incorporate sizeable recurring dividend income emanating from investment in blue chip companies. Liquidity profile is considered sound reflected by sizeable liquid assets maintained in relation to borrowings and technical reserves. However, insurance debt in relation to gross premium increased and is significantly higher than the rating benchmark.

For further information on this rating announcement, please contact the undersigned at 021-35311861-70 or Mr. Maimoon Rasheed at 042-35723411-13.


Jamal Abbas Zaidi
Advisor
Applicable rating criterion: General Insurance (March 2017)
http://jcrvis.com.pk/docs/Meth-GenInsurance201702.pdf

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