Karachi: JCR-VIS Credit Rating Company Limited (JCR-VIS) has upgraded the Insurer Financial Strength rating of ACE Insurance Limited, Pakistan (ACE Pakistan) to ‘AA-’ (Double A Minus) from ‘A+’ (Single A Plus). Outlook on the assigned rating is ‘Stable’.
Rating derives strength from the association of ACE Pakistan with ACE INA International Holdings, Ltd. In addition to timely injection of capital by the parent, in line with the increasing capital requirements for insurance companies, the company benefits from the franchise of the parent entity while also enjoying strong group support, in terms of technical expertise on the underwriting side and reinsurance coverage. Regulatory deadline for raising paid-up-capital to Rs. 300m by December 31, 2011 is expected to be met in a timely manner. The management team has depicted stability over the years and comprises experienced professionals.
With the largest reinsurance treaty capacities in the industry for fire and catastrophic cover, the company has the distinct advantage of insuring bigger risks in the market. In view of low loss retention in excess of loss treaties, the company has the ability to underwrite multiple risks. Apart from a few facultative risks, ACE Tempest Reinsurance Ltd., Bermuda is the sole provider of reinsurance for ACE Pakistan.
Business volumes exhibited healthy growth in 2010. Even though large flood-related claims were received in 2010, net claims ratio remained low. Stable stream of income arising from low-risk investments continues to support profitability position of the company.