PACRA maintains IFS Rating of Sindh Insurance Limited

The rating reflects Sindh Insurance Limited’s strong parentage - the Government of Sindh (GoS) and its ability to leverage on the same. The Company was incorporated with the objective to provide captive business to the Company form Govt. of Sindh multiple programs. The Company provides general insurance in different segments and is generating gross written premium mainly form motor segment followed by engineering segment. Further enhancement in top-line is anticipated through captive underwriting, extensive efforts are being undertaken by the Company in this regard. The Company has performed well in maintaining topline as per previous trend, also the claims observed a declining trend to boost underwriting results. Furthermore, the large investment book provides comfort to the profitability in the form of investment income. The Company further aims to develop a market-related business in the medium term which is essential moving forward.
Currently, the general insurance industry witnessed a growth of ~19% on YoY basis as of Sep-21. The insurance industry has undergone prominent changes both in terms of its size and products while entering into untapped sectors. The insurance industry is capturing market share through offering Islamic Takaful Window operations which are gaining market acceptance rapidly. The interest rate regime would impact the fixed income stream as rates have been hiking since last quarter, as discussed, the Company has invested heavily in debt securities, however, the equity market is also improving though requiring a prudent approach.
The ratings are dependent on the sustained business and financial risk. The Company has a healthy investment book and generates a good investment income. Furthermore, the Government’s backing and good governance practices are the key to sustained ratings.

About the Entity
Sindh Insurance Limited (SIL), incorporated as an unlisted public company in Dec-13, is a wholly-owned entity of Government of Sindh (GoS). GoS has presence in most dimensions of the financial market through Sindh Bank Limited, Sindh Modaraba, Sindh Insurance Limited and Sindh Microfinance Bank.
SIL has an eight-members board, chaired by Mr. Syed Akhtar Ul Islam. He has extensive experience of cargo marketing in Pakistan International Air Lines for more than thirty years. The CEO of the Company, Mr. Muhammad Faisal Siddique, brings with him a diversified experience of more than a decade in life and general insurance. He is supported by core management team comprising qualified and experienced professionals. The Company has hired new head of departments which shows the Company is committed to expand its operations.