Atlas Insurance Limited

CREDIT RATING REPORT | Aug-25

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Rating History
Dissemination Date IFS Rating Outlook Action Rating Watch
22-Aug-25 AA+ (ifs) Stable Maintain -
23-Aug-24 AA+ (ifs) Stable Maintain -
25-Aug-23 AA+ (ifs) Stable Maintain -
26-Aug-22 AA+ (ifs) Stable Maintain -
31-Mar-22 AA+ (ifs) Stable Harmonize -
About the Entity

Atlas Insurance Limited, which began its operations in 1935 and is listed on the Pakistan Stock Exchange, is a non-life insurance provider. The Company offers conventional and takaful insurance services through a nationwide network of 29 branches. The Atlas Group holds ~78% of the Company's stake, with other significant shareholders including State Life Insurance Corporation (~2.8%), financial institutions & others (~2.8%), and the general public (~16%). The Board is chaired by Mr. Iftikhar H. Shirazi, and the Company is led by the CEO, Mr. Babar Mahmood Mirza, and his team of professionals.

Rating Rationale

Pakistan's general insurance industry has a total size of ~PKR 215bln during CY24 (CY23: ~PKR 182bln), exhibiting a growth of ~18% in Gross Premium Written (GPW). The industry reported an increase of ~100% in underwriting results (CY24: ~PKR 14bln, CY23: ~PKR 7bln). Overall, the investment income experienced an increase of ~95% to ~PKR 39bln during CY24 (CY23: ~PKR 20bln). However, current economic conditions remain imperative for the overall performance of the insurance industry.
The rating reflects Atlas Insurance Limited’s entrenched position in the non-life insurance sector, anchored by its strong association with the Atlas Group, a diversified conglomerate with established presence in the Auto, Engineering, Power, Financial, and Trading sectors. The Company offers both conventional and takaful products, with conventional operations forming the bulk (~90%) of its portfolio. Atlas Insurance maintains a considerably solid market standing with a market share of ~3.4% as of CY24, supported by a diversified business mix, prudent underwriting, and a sound financial profile. In CY24, the Company posted GPW of ~PKR 7.3bln, registering solid growth (~12%), with Fire contributing the largest share (~43%), followed by Motor (~22%), Marine (~21%), and Miscellaneous (~14%) segments. On the net level, the Company retained its premium of ~PKR 3.1bln during CY24 as compared to ~PKR 2.6bln during CY23. This enabled expense control and contributed to a favorable combined ratio of ~68%. Substantially strong investment income continues to underpin the profitability. On the financial risk front, the Company has managed to post a strong level of liquidity. This, along with partnering with the financially strong reinsurers, enhances the Company’s risk absorption capacity. Equity base remains healthy. The Company benefits from a well-structured Board comprising experienced professionals, supported by sound governance practices and a seasoned management team. Continued strategic and financial backing from the Atlas Group remains a key strength, reinforcing stability and long-term business sustainability.

Key Rating Drivers

The rating depends on the continuous strengthening of the Company's market position and growing underwriting profits. Consistent support from the investment income remains fundamental for the rating. A sustainable segment mix and efficient expense management are imperative to the financial performance, with further progress envisaged.

REPORT CONTENTS
  1. Rating Analysis
  2. Financial Summary
  3. Rating Scale
  4. Regulatory Disclosure

Atlas Insurance Limited

rating analysis

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Profile
Legal Structure

Atlas Insurance Limited (‘Atlas Insurance’ or ‘the Company’) was incorporated as a public limited entity in 6-Sep-1934.


Background

The Company is a part of Atlas Group ('the Group'), a leading conglomerate holding interests in Auto, Engineering, Power, Financial, and Trading sectors. In 1934, Muslim India Insurance Company Ltd. was established; the Group acquired the Company in 1980. Later, in 2006, the name of the Company was changed to Atlas Insurance Limited. The Company became a licensed Window Takaful Operator on 2-Mar-16 by SECP under the Takaful Rules, 2012.


Operations

The Company is engaged in the general insurance business, both conventional and takaful. The Company operates a network of 29 branches divided into two zones: South (includes Karachi, Sukkur and Hyderabad) and North (includes Lahore, Rawalpindi, Islamabad, Faisalabad, Sialkot, Sahiwal, and Multan).


Ownership
Ownership Structure

The Group holds ~78% stake in Atlas Insurance. Rest is owned by Public Sector & Joint Stock Companies (~4.9%), Financial Institutions (~0.8%) and General public holds (~16%) of the stake.


Stability

Atlas Group was founded in 1962 with the establishment of Shirazi Investments (Private) Limited (SIL). Atlas is a diversified group dealing in engineering, power generation, financial services, and trading. It consists of seventeen companies. The Company’s affiliation with the Group augments stability in the ownership structure.


Business Acumen

The Group is among the biggest conglomerates operating in diversified sectors across Auto, Engineering, Power, Financial and Trading sectors.


Financial Strength

The Group holds considerable financial muscle, assets base of over a billion USD, to support the Company, if and when needed.


Governance
Board Structure

The Board comprises seven members, including two independent directors (one of whom is female), four non-executive directors, and one executive director. The independent directors strengthen policy formulation and decision making by providing objective oversight, diverse perspectives, and impartial judgment to the Board.


Members’ Profile

The Board is chaired by Mr. Iftikhar H. Shirazi since 2019. He holds over 34 years of management experience. Mr. Hassan Reza ur Rahim has a 40 years of global banking and financial services experience. With over a decade of experience in listed company governance, he brings strategic insight and independent oversight to strengthen policy formulation and decision-making. Mrs. Roohi Raees Khan has over 37 years of banking experience, including 20 years of senior leadership. She has led policy-making, strategy planning and restructuring. The BoD holds diverse profiles which remain pivotal in formulating policies for the Company. 


Board Effectiveness

To ensure effectiveness, three Board level committees are placed for smooth operations, namely; i) Audit Committee (BAC) ii) Investment Committee (IC) iii) Ethics, Human Resources and Remuneration Committee (E,HR&R). The Board meets every quarter to discuss strategies and performance outcomes. Minutes of these meetings are adequately drafted. Board committees also meet on quarterly basis and minutes are documented adequately.


Transparency

The external auditor’s BDO Ebrahim & Co. gave an unqualified opinion on the financial statements for the year ended CY24. The firm is QCR rated and is on SBPs panel of auditors in the category 'A'.


Management
Organizational Structure

The Company institutes a horizontal structure with seven departments. Each department is headed by a Department Head, who report to the CEO. The CEO reports to the BoD. However, the Head of Internal Audit department administratively reports to the CEO and functionally to the Board of Audit Committee (BAC).


Management Team

The CEO, Mr. Babar Mahmood Mirza is a veteran of insurance industry and has extensive domestic and international experience of ~33 years. He has been associated with the Company for more than seven years.The COO, Mr. Rashid Amin, brings over 21 years of experience, including more than 13 years with the Company while Mr. Muhammad Aasim Gul, CFO, has 23 years of experience with over 22 years in the Company. The management team comprises of qualified professionals.


Effectiveness

There are five management committees, namely; a) IT Committee, b) Claims Settlement Committee, c) Underwriting & Re-insurance/Co-insurance Committee, d) Risk Management and e) Management Committee. These committees meet on quarterly basis with minutes of the meeting being documented extensively.


MIS

The system comprises centralized database and web based front-end for development and reporting. It assigns authority levels to its users and enforces strict compliance with internal procedures. IT system supports Head Office operations as well as remote users provide real-time updates.


Claim Management System

Atlas Insurance has comprehensive Claim Policy with clearly defined approval authorities. The Company follows up the case with the surveyors and their performance is assessed on semi-annual basis, mainly focusing on their response time and quality of survey.


Investment Management Function

The Board’s Investment Committee sets guidelines and policies for the Company. Investment advisor, Atlas Asset Management Ltd, prudently invests and manages the Company funds. Performance is evaluated by the Investment Committee every quarter.


Risk Management framework

The Company has implemented a detailed Risk Management Framework. These guidelines tend to institute a strong risk environment, while laying down underwriting and reinsurance guidelines and identifying functions and responsibilities of all participants from the Board to the support staff.


Business Risk
Industry Dynamics

Pakistan's general insurance industry has a total size of ~PKR 215bln during CY24 (CY23: ~PKR 182bln), exhibiting a growth of ~18% in Gross Premium Written (GPW). The industry reported an increase of ~100% in underwriting results (CY24: ~PKR 14bln, CY23: ~PKR 7bln). Overall, the investment income experienced an increase of ~95% to ~PKR 39bln during CY24 (CY23: ~PKR 20bln). However, current economic conditions remain imperative for the overall performance of the insurance industry.


Relative Position

Atlas Insurance is ranked among medium tier players with a market share of ~3.4% (as of Dec-24) as per Insurance Association of Pakistan (IAP).


Revenue

During CY24, the Company underwrote GPW (conventional + takaful) of PKR 7,313mln (CY23: PKR 6,512mln), showing growth of ~12%; mainly triggering from conventional side. On segment level, Fire holds the highest share of (~43%), followed by Motor (~22%), Marine (~21%) and Misc (~14%). The Company reported a GPW of PKR 2,079mln during 1QCY25 (1QCY24: PKR 2,361mln) postng a dip. Going forward, the Company is expected to post a growth trajectory in its GPW; however, growth in the market share remains imperative.  


Profitability

During CY24, the Company’s underwriting performance improved to ~PKR 1,290mln (CY23: ~PKR 956mln), primarily due to prudent claim management and reduced acquisition costs incurred during the period. Furthermore, the bottom line was supported by healthy investment income, with profit after tax (PAT) reported at ~PKR 2bln in CY24 (CY23: ~PKR 1bln). In 1QCY25, the Company reported a PAT of ~PKR 354mln (1QCY24: ~PKR 391mln). Looking ahead, the Company is well-positioned to sustain this upward momentum through continued underwriting discipline, efficient claims management, and further enhancement of investment income.


Investment Performance

The Company has maintained a healthy investment book clocking in at ~PKR 14,701mln in CY24 (CY23: ~PKR 9,195mln); and generated investment income of ~PKR 2,058mln during CY24 (CY23: ~PKR 722mln). The Investment book is majorly concentrated with equity securities (~63%), followed by cash and bank balance (~18%), government securities (~12%), and subsidiaries (~6%). During 1QCY25, investment book of the Company stood at ~PKR 15,196mln and generated investment income of ~PKR 241mln. The uptick in the investment book's position is supportted by revaluation of listed shares and mutual funds as of CY24 and 1QCY25. Going forward, the Company is well positioned to sustain investment income growth.


Sustainability

Expansion is also on cards with new branches to be added to the existing branch network. The Company is now focusing on flourishing its window takaful operations – especially in the motor segment. The Company must also work on accelerating its GPW growth by tapping into new markets and enhancing its product portfolio. 


Financial Risk
Claim Efficiency

As of CY24, the Company's claims outstanding days increased to 417 days (CY23: ~266 days), primarily due to an increase in outstanding claims. The claims liquidity ratio (claims to liquid investments) fell to 25% as of CY24 (CY23: ~46%). Additionally, the commercial efficiency ratio remained stable at ~1.0x as at CY24 (CY23: 1.0x). As of 1QCY25, the commercial efficiency of the Company stood at ~1.2x. Going forward, the Company must accelerate claims settlement and reinforce liquidity to compress outstanding days and improve claims resilience.


Re-Insurance

The Company has re-insurance arrangements with some of the best renowned international reinsurers including Swiss Re (rated “AA-” by S&P), Hannover Re (rated “AA-” by S&P), Malaysian Re (rated “A-” by A.M Best), Labuan Re (rated “A-” by A.M. Best), PRCL (rated “A” by VIS) among others. Treaty arrangements predominantly comprises surplus treaty and this bodes well for the Company.  


Cashflows & Coverages

The Company maintains a healthy liquidity profile, liquidity coverage ratio (liquid assets / net insurance & takaful claims) rose to ~6.6x as of CY24 (CY23: ~5.3x). Whereas, net liquidity ratio [(liquid assets - borrowing) / outstanding claims] stands at 4.2x as at CY24 (CY23: ~2.2x). Looking ahead, the Company should continue to prioritize liquidity risk management through proactive asset-liability alignment


Capital Adequacy

The SECP recently issued a notification stating that the Minimum Capital Requirement (MCR) for non-life insurers has been increased to PKR 2bln, effective by 2030. The Company currently has a paid-up capital of PKR 1,494mln. Its equity base stood at PKR 8,413mln as of CY24 (CY23: PKR 4,855mln). As of 1QCY25, the Company’s equity increased to ~PKR 8,945mln (1QCY23: ~PKR 5,502mln). The uptick in the shareholder's equity is supported by ~PKR 3bln of revluation gain on investments;however, the Company holds massive strength to ensure compliance with the SECP’s MCR requirement. 
 
 

Aug-25

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Atlas Insurance Limited

financial summary

(PKR mln)

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Mar-25
3M		 Dec-24
12M		 Dec-23
12M		 Dec-22
12M
Management Audited Audited Audited
A. BALANCE SHEET
1. Investments 15,196 14,701 9,195 6,828
2. Insurance Related Assets 4,170 3,442 4,176 2,674
3. Other Assets 966 1,013 694 514
4. Fixed Assets 428 334 234 222
5. Window Takaful Operations 0 0 0 0
Total Assets 20,760 19,490 14,299 10,238
1. Underwriting Provisions 3,164 2,823 2,600 1,997
2. Insurance Related Liabilities 3,597 3,306 4,125 2,711
3. Other Liabilities 4,915 4,880 2,643 1,776
4. Borrowings 139 68 76 100
5. Window Takaful Operations 0 0 0 0
Total Liabilities 11,815 11,077 9,444 6,584
Equity/Fund 8,945 8,413 4,855 3,655
B. INCOME STATEMENTS
CONSOLIDATED INCOME STATEMENT
1. Gross Premium Written/Gross Contribution Written 2,079 7,313 6,512 5,233
2. Net Insurance Premium/Net Takaful Contribution 945 3,355 2,718 2,437
3. Underwriting Expenses (616) (2,145) (1,762) (1,466)
Underwriting Results 329 1,209 956 971
4. Investment Income 241 2,058 722 66
5. Other Income / (Expense) (7) 5 159 76
Profit Before Tax 562 3,272 1,838 1,114
6. Taxes (208) (1,222) (815) (376)
Profit After Tax 354 2,050 1,022 738
PARTICIPANTS' TAKAFUL FUND - PTF
1. Gross Contribution Written 219 767 650 536
2. Net Takaful Contribution 67 260 167 176
3. Net Takaful Claims (63) (210) (227) (195)
4. Direct Expenses Including Re-Takaful Rebate Earned 13 45 35 20
Surplus Before Investment & Other Income/(Expense) 17 95 (25) 1
5. Investment Income 14 109 68 32
6. Other Income/(Expense) (5) (43) (28) (15)
Surplus for the Period 25 161 15 19
OPERATOR'S TAKAFUL FUND - OTF
1. Wakala Fee Income 59 211 168 128
2. Management, Commission & Other Acquisition Costs (34) (131) (109) (73)
Underwriting Income/(Loss) 25 80 60 55
3. Investment Income 6 56 51 32
4. Other Income/(Expense) (0) 0 (1) 1
Profit Before tax 30 136 109 87
5. Taxes (10) (53) (48) (46)
Profit After tax 20 83 61 41
C. RATIO ANALYSIS
1. Profitability
Loss Ratio - Net Insurance & Takaful Claims / Net Insurance Premium or Takaful Contribution 32.0% 29.5% 34.4% 37.5%
Combined Ratio (Loss Ratio + Expense Ratio) 65.3% 63.9% 64.9% 60.1%
2. Investment Performance
Investment Yield 6.4% 17.2% 9.0% 0.9%
3. Liquidity
(Liquid Assets - Borrowings) / Outstanding Claims Including IBNR 4.1 4.2 2.2 2.6
4. Capital Adequacy
Liquid Investments / Equity (Funds) 96.2% 99.9% 138.2% 154.7%

Aug-25

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Atlas Insurance Limited

rating scale

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Aug-25

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Atlas Insurance Limited

regulatory disclosure

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  1. Rating Team Statements
    1. Rating is just an opinion about the creditworthiness of the entity and does not constitute a recommendation to buy, hold, or sell any security of the entity rated or to buy, hold, or sell the security rated, as the case may be. (Chapter III; 14-3-(x))
    2. Conflict of Interest
      1. The Rating Team or any of their family members have no interest in this rating (Chapter III; 12-2-(j))
      2. PACRA, the analysts involved in the rating process, and members of its rating committee and their family members do not have any conflict of interest relating to the rating done by them (Chapter III; 12-2-(e) & (k))
      3. The analyst is not a substantial shareholder of the customer being rated by PACRA [Annexure F; d-(ii)]
      4. Explanation: for the purpose of the above clause, the term "family members" shall include only those family members who are dependent on the analyst and members of the rating committee.
  2. Restrictions
    1. No director, officer, or employee of PACRA communicates the information acquired by him for use for rating purposes to any other person, except where required under law to do so. (Chapter III; 10-(5))
    2. PACRA does not disclose or discuss with outside parties or make improper use of the non-public information which has come to its knowledge during a business relationship with the customer. (Chapter III; 10-7-(d))
    3. PACRA does not make proposals or recommendations regarding the activities of rated entities that could impact a credit rating of the entity subject to rating. (Chapter III; 10-7-(k))
  3. Conduct of Business
    1. PACRA fulfills its obligations in a fair, efficient, transparent, and ethical manner and renders high standards of services in performing its functions and obligations. (Chapter III; 11-A-(a))
    2. PACRA uses due care in the preparation of this Rating Report. Our information has been obtained from sources we consider to be reliable, but its accuracy or completeness is not guaranteed. PACRA does not, in every instance, independently verify or validate information received in the rating process or in preparing this Rating Report. (Clause 11-(A)(p))
    3. PACRA prohibits its employees and analysts from soliciting money, gifts, or favors from anyone with whom PACRA conducts business. (Chapter III; 11-A-(q))
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    3. PACRA discloses that no shareholder directly or indirectly holding 10% or more of the share capital of PACRA also holds directly or indirectly 10% or more of the share capital of the entity which is subject to rating or the entity which issued the instrument subject to rating by PACRA. (Chapter III; 12-2-(f))
    4. PACRA ensures that the rating assigned to an entity or instrument is not affected by the existence of a business relationship between PACRA and the entity or any other party, or the non-existence of such a relationship. (Chapter III; 12-2-(i))
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  5. Monitoring and Review
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  6. Probability of Default
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