Press Release

VIS Reaffirms IFS Rating of Allianz EFU Health Insurance Limited

Karachi, May 31, 2021: VIS Credit Rating Company Limited has reaffirmed the Insurer Financial Strength (IFS) rating of ‘A’ (Single A) assigned to Allianz EFU Health Insurance Limited (Allianz EFU). The IFS rating signifies high capacity to meet policyholder and contractual obligations. Risk factors may vary over time due to business/economic conditions. Outlook on the assigned rating is ‘Stable’. The previous rating action was announced on June 12, 2020.

The rating assigned to Allianz EFU take into account the implicit support of the sponsors including EFU group and Allianz SE, a Germany-based financial services provider and holding company of the Allianz Group (Allianz SE rated AA by Standard & Poor’s and A+ by A.M.Best). The group is present in more than 70 countries with major operations in Europe. The rating reflect stagnant business volumes owing to ongoing pandemic, frequent lockdowns, overall contraction in demand and challenging economic environment; the same may pose as challenges for growth in the insurance industry during the rating horizon. The underwriting performance exhibited considerable improvement on the back of improved claims ratio in line with lower incidence of claims as management tapered off high-risk clients during the review period; the same reflected positively on the profitability indicators. The rating takes into account the continuing trend of low capitalization levels and high leverage ratios. Insurance debt in relation to gross premium declined on a timeline basis; the aging of receivables is considered sound. Retaining market leadership in health insurance business with a market share of around 19% would remain a key rating driver.

For further information on this rating announcement, please contact Ms. Maham Qasim (042-35723411-13, Ext. 8010) and/or the undersigned at 021-35311861-66 (Ext. 201) or email at .

Javed Callea

Applicable Rating Criteria: General Insurance (November 2019)

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