Pakistan Credit Rating Agency Limited upgrades Insurer Financial Strength Rating of Adamjee Insurance

Lahore, February 26, 2016 (PPI-OT): The Pakistan Credit Rating Agency Limited (PACRA) has upgraded the IFS Rating of Adamjee Insurance Company Limited (AICL) to ‘AA+’ (Double A Plus) [previous: AA]. The rating is currently the highest assigned to any general insurance company in Pakistan. It denotes very strong capacity of the company to meet policyholder and contract obligations.

The rating reflects improved fundamentals of the company. AICL’s focus on growth of business, while reinvigorating its underwriting practices and rationalizing its cost structure, is reflecting positively on its core profitability. Clarity in the business plan, stability in higher management, and the team’s concerted efforts have yielded benefits. Foreign operations need to supplement profitability. Enhanced MIS setup has enabled the company to improve efficiency in claims settlement.

The company’s sizeable investment portfolio, albeit concentrated in few group companies, continues to supplement its profitability and financial strength. Meanwhile, the rating takes into account the association of AICL with Nishat flagship companies. The business strategy, going forward, is focused on increasing its market share through expansion of branch network – home and abroad – along with product innovation; retail and micro insurance. Furthermore, AICL is eyeing geographical diversification in other regions, as well.

The rating is dependent on stability in the management team and their efforts to execute the business plan. AICL must continue to strengthen its market position, while achieving sustainability in underwriting profits. With a strengthened claims management system in place, maintaining lower claims turnaround time (TAT) remains vital.

For more information, contact:
Hammad Rashid
Analyst
The Pakistan Credit Rating Agency Limited (PACRA)
Awami Complex, FB1, Usman Block New Garden Town,
Lahore – Pakistan
Tel: +9242 586 9504 -6
Fax: +9242 583 0425
Email: hammad.rashid@pacra.com
Web: www.pacra.com