PACRA Assigns Initial IFS Rating to National Insurance Company Limited

The IFS rating of National Insurance Company Limited (“NICL” or “the Company”) derives significant strength from being wholly owned by the Government of Pakistan through the Ministry of Commerce, benefitting from strong sovereign backing, providing strategic direction, financial flexibility, and operational support. Effective representation of the Government at the Board level ensures oversight, strengthened governance practices, and a supportive decision-making framework aligned with the Company’s long-term objectives. NICL maintains an established position within Pakistan’s general insurance industry, primarily supported by the mandated role as insurance coverage provider for the government-owned entities and public sector organizations, which underpins the stability and continuity of its business profile. The Company’s client base includes major public sector entities such as SNGPL, The Bank of Punjab, PKLI, PARCO, NBP, OGDCL and so on. With a captive clientele, GPW experienced growth in CY25 reaching to PKR 30.6bln (CY24: PKR 21.3bln) with the business mix comprising Engineering (45%), Marine, aviation and transport (27%), Fire and Property (24%), Motor (3%) and Miscellaneous (2%). The Company’s earnings profile is underpinned by its sizeable investment portfolio of approximately PKR 98bln, predominantly concentrated in Pakistan Investment Bonds (PIBs) and Treasury Bills (T-Bills), supplemented by exposures in equity market instruments, term deposits, and investment properties. The portfolio composition reflects a prudent asset allocation strategy with a strong tilt towards sovereign and income-generating assets, facilitating stable recurring investment returns through dividend yields, mark-up income, and rental streams. The strength of the Company’s investment book, coupled with its underwriting discipline, translated into a Profit After Tax (PAT) of PKR 8.8bln during CY25 (CY24: PKR 7.9bln), primarily driven by robust underwriting profits of PKR 3.2bln (CY24: PKR 2.5bln) alongside sustained contribution from investment income, thereby reinforcing earnings resilience and strengthening the Company’s overall financial profile.
The audit for CY25 is currently in progress, poised to get completed soon, as per the management representation. As of CY24, the Company had reinsurance receivables amounting to PKR 74bln from Pakistan Reinsurance Company Limited, which, as per management’s statement, have been substantially reduced. This is an area of consideration. Alongside, the auditor highlighted emphasis of matter in the report that needs to be resolved. On the financial risk front, the Company holds adequate liquidity with considerable equity standing. Higher claims stress the commercial efficiency; however, the Company gathers support from Pakistan Reinsurance Company Limited as the primary reinsurer. Despite the gradual privatization of public sector entities over the years, the Company has sustained and expanded its business size, reflecting its strong underwriting capacity and market presence. The Company plans to further expand its footprint by offering insurance products to the private sector. The rating captures the strength of the Company’s sovereign backing through the Government of Pakistan, strong underwriting performance and investment income streams.
Going forward, the successful introduction of new products will be key to sustaining business volumes in an increasingly competitive environment. Overall, NICL remains well-positioned in the insurance sector, supported by a strong financial profile, disciplined underwriting, and a stable investment base.

About the Entity
The National Insurance Corporation was converted into National Insurance Company Limited (“NICL” or “the Company”) with effect from January 2001 to operate under the Insurance Ordinance 2000. NICL has a paid up capital of PKR 2bln. The change in stature from a statutory corporation to a corporate body was aimed at running this organization on purely commercial lines. The Company is governed by Board of Directors headed by Ali Syed, with board members appointed by the Government of Pakistan. NICL Limited is 100% owned by Government of Pakistan (G.O.P) and working under the administrative control of Ministry of Commerce (MOC).