PACRA Maintains IFS Rating of Premier Insurance Limited
The rating reflects sustained efforts of the incumbent leadership to steer the company out of prevalent challenges. The company is envisaged to cautiously underwrite insurance business; the market share has gone down. The results are depicted in the fall of GPW but with greater decrease in the amount of underwriting losses. The support to profitability has exuded from investment income, though largely contributed by relatively high risk equity investments. The company has accumulated a high quantum of liabilities, protected by reinsurance receivables and liquid investments; some evasion therein is seen. High level of equity maintenance is imperative.
The rating is dependent on fast scale towards indicators. Meanwhile, the management has to carefully manage its insurance asset liability structure wherein timely realization of outstanding premium along with smooth settlement of claims is vital. Any further infusion of the risk capacity of the company may impact the rating.
Premier Insurance was incorporated in 1952 and is listed on Pakistan Stock Exchange. It holds
0.9% market share at end Sep' 18 and operates through two business Hubs South and North.
Crescent Group and its associated companies hold 70% shareholding. State Life Insurance Company is another major shareholder (11%). The Crescent Group (CG) operates in diversified sectors of textile, steel, sugar, and power. The end Dec' 17 accounts of the company were reviewed by M/s Deloitte Yousuf Adil, issuing a qualified opinion. The eight-member board, including CEO, includes five representations of Crescent Group and one of State Life Insurance. Mr. Asad ullah Khawaja has joined the Board as an independent Director since June 2017. Mr. Zahid Bashir took over the charge of the company as CEO from June 2017.