JCR-VIS reaffirms Insurer Financial Strength rating of ACE Insurance Limited, Pakistan

Karachi, December 01, 2015 (PPI-OT):JCR-VIS Credit Rating Company Limited (JCR-VIS) has reaffirmed the Insurer Financial Strength rating of ACE Insurance Limited, Pakistan (ACE Pakistan) at ‘AA’ (Double A). Outlook on the assigned rating is ‘Stable’. The previous rating action was announced on October 17, 2014.

The assigned rating of ACE Insurance Limited (ACE Pakistan) derives strength from the ACE Group. ACE Pakistan is a wholly owned subsidiary of ACE INA International Holdings, Ltd. Delaware, USA, which is part of ACE Group. ACE Group is one of the world’s largest multiline Property and Casualty insurers with operations in 54 countries. Financial strength of the parent entity is strong as reflected in its Financial Strength Rating of ‘AA’ by an international rating agency.

The rating incorporates ACE Pakistan’s strong risk adjusted capitalization level as evident from strong treaty protection, conservative investment profile, sound liquidity indicators and one of the lowest combined ratios in the industry. Support from the parent entity is evident in terms of sizeable treaty capacities, largest in the domestic context, providing ACE Pakistan significant advantage in terms of business generation while allowing the company to prudently manage risk. Reinsurance treaties provide coverage for risks written outside Pakistan as well; enabling geographical risk diversification. Moreover, technical support from the Group provides strength to underwriting operations.

Business volumes depicted healthy growth during 2014 which along with low losses during the period translated into significant increase in underwriting profitability. Gross premium witnessed a decline in the ongoing year during 1HCY15; the same has witnessed an uptick during 3QCY15 on account of renewals due in July and underwriting of power sector exposures at a significant increase in premium rates. Despite multiple claims in the ongoing year, underwriting profitability has remained robust due to strong treaty protection.

Overall profitability profile is supported by sizeable other income from bank placements. ACE Pakistan benefits from qualified and competent team of senior management professionals. Changes were witnessed in the senior management team; vacancies have been filled through internal promotions.

For more information, contact:
Ms. Sobia Maqbool
JCR-VIS Credit Rating Company Limited
VIS House, 128/C,
25th Lane off Khayaban-e-Ittehad,
Phase VII, DHA, Karachi
Tel: +92-21-35311861-72
Fax: +92-21-35311873
Email: sobia@jcrvis.com.pk