East West Insurance Company Limited

CREDIT RATING REPORT | Oct-25

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Rating History
Dissemination Date IFS Rating Outlook Action Rating Watch
10-Oct-25 AA+ (ifs) Stable Maintain -
10-Oct-24 AA+ (ifs) Stable Upgrade -
12-Jul-24 AA (ifs) Positive Maintain -
20-Nov-23 AA (ifs) Stable Maintain -
25-Nov-22 AA (ifs) Stable Maintain -
About the Entity

East West Insurance Company ("East West" or “the Company") was incorporated as a Public Listed Company (listed on PSX) and became operational in 1983. The Company operates as a general insurance company, with the primary tilt towards the fire & property segment. Yunus family holds the majority shareholding (~69%) of the Company, through individuals (~42%) and the holding company (~27%). The rest resides with the general public. The Board, dominated by the sponsoring family, is chaired by Mr. Umeed Ansari since Apr-24. Mr. Naved Yunus leads the Company as the CEO, supported by Mr. Saad Yunus as the Deputy MD. They are assisted by a professional team.

Rating Rationale

The IFS rating of East West Insurance Company Limited (‘East West’ or ‘the Company’) takes comfort from a stable risk profile supported by the Sponsors. The Company has evolved from being a mid-tier player in the industry to managing a strong capacity to meet policyholders' and contract obligations. The Company is engaged in conventional (~91% of the total GPW) and window takaful operations. During CY24, East West witnessed an uptick of ~26% in the overall GPW reported at ~PKR 8.5bln, while witnessing an uptick of ~30% during 6MCY25, reported at ~PKR 5.1bln. Fire & property remained the top segment, contributing ~36% during the period, followed by engineering (~22%), motor (~18%), marine, aviation & transport (~13%), and miscellaneous (~11%). Solid underwriting performance, posting an uptick of ~49% (CY24) and 45% (6MCY25), along with stable support from the investment book's performance, which grew by ~86% (CY24) and 9.4% (6MCY25), led to a secure and profitable bottom line. However, prudent business underwriting remains essential to sustain profitability. The management vision towards digitization would improve business volumes. On the financial front, the capital structure holds a considerable standing, especially with Sponsors’ injection of ~PKR 800mln through rights issue during CY24. The claims management system remains prudently managed, and the overall financial risk profile remains intact with substantial liquidity on the Company’s balance sheet. A strong panel of reinsurers provides additional protection, instilling confidence in the Company's ability to navigate uncertainties effectively. Strong governance framework and prudent managerial practices bode well for the Company.

Key Rating Drivers

The rating is dependent on the Company’s ability to sustain the market share, along with augmenting the profits. The financial risk profile through improved liquidity position must remain in line with the growth. Substantial cushion from the underwriting business, along with strengthening of underwriting discipline, shall remain crucial for the rating, going forward.

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

East West Insurance Company Limited

rating analysis

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Profile
Legal Structure

East West Insurance Company Limited ("East West" or "the Company") was incorporated as a public limited company in 1983 and is listed on PSX.


Background

Late Mr. Unus Khan, with work experience in the insurance segment across Middle East, founded East West in 1983. Initially, the Company began to operate as a general insurer in the conventional business only. Later, East West tapped into Window Takaful Operations (WTO) from May 2018 as per SECP Takaful Rules, 2012. Today, the Company's operations are carried out through principal offices located in the South, Punjab, and North of the country.


Operations

Currently, the Company is engaged in conventional and takaful general insurance business, with a nationwide network of 65 offices. These include 3 principal, 9 regional, 23 agency offices, and 30 branch offices.


Ownership
Ownership Structure

The shareholding is divided equally among the four sons of the Late Mr. Unus Khan. ~69% of the holding resides with the sponsoring family through individuals (~42%) and the holding company (~27%). The remaining ~31% shares are held by various other individuals and institutions.


Stability

The sponsoring family has strengthened its shareholding structure by creating a holding company that consolidates the family's overall stake in the business. Moreover, the gradual induction of the third generation further fortifies the ownership's stability.


Business Acumen

The sponsors hold almost three decades of experience in the insurance sector and have witnessed numerous business cycles over time. Also, the sponsors possess the requisite skills and knowledge to effectively steer the Company.


Financial Strength

The sponsoring family holds an adequate financial footing to support the Company, if needs be, going forward.


Governance
Board Structure

The overall control of the Company lies with the ten-member Board (BoD). The BoD comprises five Independent, one Non-Executive, and four Executive Directors. The BoD holds substantial independence and gender diversity as well. However, the BoD is dominated by the sponsoring family.


Members’ Profile

Mr. Umeed Ansari, an Independent Director, is the BoD chairman. Mr. Ansari brings over five decades of diverse experience to the role. Mr. Ahsan Alvi, an Independent Director, has been associated with the insurance segment since 1987 and with the Company for over a decade. Mrs. Urooj Y. Ansari is a Non-Executive Director and has been associated with the group for 6 years, and is part of the HR & Nomination Committee.  The Board possesses a diverse set of expertise and skillsets.


Board Effectiveness

During CY24, the BoD met five times and is assisted by four committees: Audit Committee, Ethics, Human Resource & Remuneration Committee, Investment Committee, and Nomination Committee. Nomination Committee is headed by a Non-Executive Director. while the rest are headed by an Independent Director. Committee meetings are held frequently, and minutes are maintained adequately. 




Transparency

External Auditors, M/s Crowe Hussain Chaudhury & Co. Chartered Accountants, have issued an unqualified opinion on the financial statements for CY24. The firm has been QCR rated and is on panel 'A' of SBP.


Management
Organizational Structure

The Company has clear reporting lines ensuring the segregation of duties. Each HoD reports to the CEO, who then reports to the BoD. However, the Head of Internal Audit and HR administratively reports to the Chief Executive Officer (CEO); while functionally reports to the BoDs' respective committees


Management Team

Mr. Naved Yunus holds the position of CEO and has been associated with the Company for four decades. Mr. Saad Yunus holds the position of Deputy Managing Director and brings in an experience of a decade. Mr. Saad has been associated with the Company for eight years. The Company’s management consists of qualified and experienced professionals with a  long standing association with the Company.


Effectiveness

The management is assisted by four committees: Underwriting, Claims Settlement, Reinsurance & Co-Insurance, and Risk Management. These committees meet every quarter to discuss all operational issues of the organization and provide strategic and operational guidance to all the departments. Minutes of these meetings are maintained adequately.


MIS

The updated version of the MIS system was rolled out in the head office, while the complete rollout in the branches is expected to be completed soon.


Claim Management System

The claim settlement procedure is decentralized at the branch level. The head office is only responsible for monitoring. Claim approval authority is retained at the head office level. The head office sets and reviews periodically the limits for settlement by the branches. Claims equal to higher than that limit are not only circulated to the higher management but are also monitored by the Head Office.


Investment Management Function

The investment committee comprises five BoD members, including the BoDs Chairman. The Company has an established investment department with a structured investment policy statement (IPS) that provides guidelines, such as stop loss limits, and identifies limits for various investment avenues.


Risk Management framework

The Company follows adequate risk management procedures and guidelines as defined by the BoD. The Company has developed standard operating procedures manual incorporating detailed guidelines to be followed before the issuance of a policy.


Business Risk
Industry Dynamics

Pakistan's general insurance industry reached a total size of ~PKR 55bln in 3MCY25 (3MCY24: ~PKR 50bln), marking ~9% growth in Gross Premium Written (GPW) from the previous period. The sector's financial performance witnessed a decline, with underwriting results deteriorating by~7% to PKR 4bln (3MCY24: ~PKR 4.3bln). However, investment income witnessed an uptick of 18%, reported at ~PKR 7.2bln (3MCY24: ~PKR 6.1bln), supporting the net profit reported at ~PKR 7.2bln (3MCY24: ~PKR 7.3bln). Going forward, the industry is expected to follow the same trajectory.


Relative Position

East West has a market share of ~3.9% and is classified among medium-sized companies in the industry in terms of GPW.


Revenue

The Company generates the majority of Gross Premium Written (GPW) from conventional business (91%), while the rest (~9%) is generated from takaful business. During CY24, fire & property stood as the top segment, contributing ~36% to GPW, followed by engineering (~21%), motor (~16%), marine, aviation & transport (~14%), and miscellaneous (~14%). The Company reported GPW of ~PKR 8.5bln during CY24 (CY23: ~PKR 6.7bln), an uptick of ~26% driven from an increase in GPW primarily from fire & property. During 6MCY25, the Company reported GPW of ~PKR 5.1bln (6MCY24: ~PKR 3.9bln), an uptick of ~30% due to an uptick in GPW from fire & property by ~53%. Going forward, GPW is expected to witness an improving trajectory. 


Profitability

During CY24, the Company reported an uptick of ~49% in underwriting profits, reported at ~PKR 703mln (CY23: 472mln), due to controlled underwriting expenses. The net profit witnessed an uptick of ~67%, reported at ~PKR 986mln (CY23: ~PKR 589mln), supported by an increased investment income. During 6MCY25, the Company reported an underwriting profit of ~PKR 613mln (6MCY24: ~PKR 424mln), an uptick of ~45% due to controlled management and commission expenses. The Company reported net profit of ~PKR 587mln (6MCY24: ~PKR 444mln), supported by investment income. Upholding prudent underwriting practices will remain beneficial, going forward.  


Investment Performance

As of CY24, the investment book of the Company comprises debt securities (~53%), government securities (~35%), savings and deposits (~4%), equity (~3%), subsidiaries & associates (~2%), while the rest is divided among cash & bank and investment properties. During CY24, the Company witnessed an uptick of ~86% in investment income reported at ~PKR 756mln (CY23: ~PKR 407mln), driven by gains on revaluation of investments. During 6MCY25, the Company reported investment income of ~PKR 341mln (6MCY24: ~PKR 311mln), an uptick of ~10% due to gains on disposal of investments. Going forward, prudent investment management would enhance the bottom line.


Sustainability

The Company's focus on diversification – engineering and health segments, besides the fire segment - bodes well for its growth. Also, the vision is to tap into large projects in the engineering segment. East West aims to increase its footprint in agriculture and microinsurance.


Financial Risk
Claim Efficiency

As of CY24, claims outstanding days improved significantly to 123 days (CY23: ~169 days), indicating an efficient claims settlement process of the Company. As of 6MCY25, claims outstanding days deteriorated to 145 days (6MCY24: ~129 days) due to an increase in the clains incurred during the period by ~81%, leading to claims outstanding at ~PKR 2.1bln (6MCY24: ~PKR 1.2bln).



Re-Insurance

The Company has reinsurance agreements with 14 reinsurers. Among these the top reinsurers include Saudi Reinsurance Company (A- by S&P), Africa Re (A- by AM Best), Hanover Re (AA- by AM Best), PICC Reinsurance Company Limited (A by S&P), Pakistan Reinsurance Company Ltd. (A by VIS), Abu Dhabi National Insurance Company (A by S&P), Antares Global Management Ltd (A by AM Best), Singapore Reinsurance Corp. Ltd (A by AM Best), Kuwait Re (A- by AM Best), MGA Speciality (A by AM Best).


Cashflows & Coverages

As of CY24, liquid assets/claims outstanding cover improved to ~3.2x (CY23: ~2.4x), due to an increase in liquid assets by ~69.6%, reported at ~PKR 5.5bln (CY23: ~PKR 3.2bln). As of 6MCY25, the cover was reported at ~3.5x (6MCY24: ~3.3x) while liquid assets witnessed an uptick of ~84%, reported at ~PKR 7.4bln (6MCY24: ~PKR 4bln).


Capital Adequacy

During CY24, the sponsors injected ~PKR 800mln in equity, increasing paid-up capital to ~PKR 2,559mln (CY23: 1,759mln). Shareholders' equity hence witnessed an uptick and was reported at ~PKR 4.8bln (~PKR 3.4bln). As of 6MCY25, the shareholders' equity was reported at 5.3bln (6MCY24: ~PKR 3.9bln) due to an increase in accumulated profits. The Company meets SECP’s capital adequacy requirement.
 
 

Oct-25

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East West Insurance Company Limited

financial summary

(PKR mln)

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Jun-25
6M		 Dec-24
12M		 Dec-23
12M		 Dec-22
12M
Management Audited Audited Audited
A. BALANCE SHEET
1. Investments 7,621 5,675 3,527 2,411
2. Insurance Related Assets 3,769 3,580 3,428 3,136
3. Other Assets 1,063 1,063 836 697
4. Fixed Assets 294 244 213 139
Total Assets 12,747 10,562 8,004 6,383
1. Underwriting Provisions 2,528 2,415 1,931 1,803
2. Insurance Related Liabilities 2,856 2,017 1,499 1,645
3. Other Liabilities 1,968 1,316 1,137 384
4. Borrowings 38 41 41 20
Total Liabilities 7,390 5,788 4,608 3,852
Equity/Fund 5,357 4,773 3,395 2,532
B. INCOME STATEMENTS
CONSOLIDATED INCOME STATEMENT
1. Gross Premium Written/Gross Contribution Written 5,157 8,481 6,740 5,386
2. Net Insurance Premium/Net Takaful Contribution 3,550 4,879 4,137 2,967
3. Underwriting Expenses (2,937) (4,176) (3,665) (2,491)
Underwriting Results 613 703 472 476
4. Investment Income 341 756 407 188
5. Other Income / (Expense) (152) (249) (197) (172)
Profit Before Tax 802 1,210 682 492
6. Taxes (215) (224) (93) (89)
Profit After Tax 587 986 589 403
PARTICIPANTS' TAKAFUL FUND - PTF
1. Gross Contribution Written 459 805 600 440
2. Net Takaful Contribution 147 282 132 79
3. Net Takaful Claims (123) (294) (149) (90)
4. Direct Expenses Including Re-Takaful Rebate Earned 15 26 23 26
Surplus Before Investment & Other Income/(Expense) 40 13 6 15
5. Investment Income 0 0 0 0
6. Other Income/(Expense) 0 0 0 0
Surplus for the Period 40 13 6 15
OPERATOR'S TAKAFUL FUND - OTF
1. Wakala Fee Income 157 293 200 155
2. Management, Commission & Other Acquisition Costs (105) (187) (123) (109)
Underwriting Income/(Loss) 52 106 76 46
3. Investment Income 2 3 3 3
4. Other Income/(Expense) (0) (1) (1) (1)
Profit Before tax 53 108 78 48
5. Taxes 0 (31) (22) 0
Profit After tax 53 77 56 48
C. RATIO ANALYSIS
1. Profitability
Loss Ratio - Net Insurance & Takaful Claims / Net Insurance Premium or Takaful Contribution 47% 46% 48% 48%
Combined Ratio (Loss Ratio + Expense Ratio) 83% 86% 89% 84%
2. Investment Performance
Investment Yield 10% 17% 14% 8%
3. Liquidity
(Liquid Assets - Borrowings) / Outstanding Claims Including IBNR 3.5 3.2 2.4 1.4
4. Capital Adequacy
Liquid Investments / Equity (Funds) 141% 117% 101% 92%

Oct-25

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East West Insurance Company Limited

rating scale

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Oct-25

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East West Insurance Company 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.
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    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
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