The Pakistan Credit Rating Agency Limited
Press Release


Ayesha Qasim

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PACRA Maintains IFS Rating of Adamjee Insurance Company Limited

Rating Type IFS
(29-Sep-17 )
(27-Feb-17 )
Action Maintain Maintain
IFS Rating AA+ AA+
Outlook Stable Stable
Rating Watch - -

The ratings reflect the sustained fundamentals of the company. AICL has been growing the business profile along with keeping costs under check, hence resulting positive for the core profitability. The stability in the management team and concerted efforts are the positives. AICL continues to enjoy the perk of being only company with operations outside Pakistan. The added efficiency in the MIS setup has resulted into improved proficiency in claims settlement. The company's sizeable investment portfolio, albeit concentrated in few group companies, continues to supplement its profitability and financial strength. 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 microinsurance. Furthermore, AICL is eyeing geographical diversification in other regions, as well. The ratings incorporates the effect of association of AICL with Nishat flagship companies.<p>The ratings depend on the stability and continuous efforts of the management team to execute the business plan. AICL must continue to strengthen its market position along with sustained underwriting profits. With a strengthened claims management system in place, maintaining lower claims turnaround time (TAT) remains vital.

About the Entity
AICL is the second largest general insurer of Pakistan, holding 26% of the country's GPW at end-Jun17 (end-Jun16: 23%). The company, incorporated in 1960, is owned and controlled by Nishat flagship companies since 2004, mainly through MCB Bank Limited. It is listed on Pakistan Stock Exchange. It operates a network of 29 branches and divisions in Pakistan and three branches in the UAE.<p>The eight-member board of directors, including the CEO, has five non-executive directors and two independent directors. The chairman of BoD is Mr. Umer Mansha. The board includes professionals having exposure to textile, sugar, leather and banking sectors. Mr. Muhammad Ali Zeb is the CEO of the company since June 2013, who also remained CEO for three years until 2011. He is assisted by a team of experienced professionals.

The primary function of PACRA is to evaluate the capacity and willingness of an entity to honor its obligations. Our ratings reflect an independent, professional and impartial assessment of the risks associated with a particular instrument or an entity. PACRA's comprehensive offerings include instrument and entity credit ratings, insurer financial strength ratings, fund ratings, asset manager ratings and real estate gradings. PACRA opinion is not a recommendation to purchase, sell or hold a security, in as much as it does not comment on the security's market price or suitability for a particular investor.