PACRA Upgrades IFS Rating of Pak-Qatar Family Takaful Limited

Pak Qatar Family Takaful Limited (“Pak Qatar” or “the Company”) benefits from strong sponsor support, reflected in its robust governance structure and growing market presence in the life insurance sector. The sector is primarily dominated by the public sector (~58% market share), while the private sector accounts for ~42%. Overall, the sector booked a GPW of ~PKR 196bln during 6MCY25 (6MCY24: ~PKR 169bln), reflecting a YoY growth of ~16%. Robust investment income, generated from a portfolio of ~PKR 2,419bln as of 6MCY25, supported the bottom line. The overall outlook remains stable, underpinned by favorable underwriting metrics and continued strength in investment returns. Pak Qatar's market share grew from 4.4%, and stood at ~6.3% as of 9MCY25. The Company has achieved YoY growth (~3% during 9MCY25 and ~77% during CY24) in its GPW, which is largely driven by single-premium business. Though both first-year and renewal persistency remain low, the Company holds substantial ability to manage its claims backed by a strong liquid profile. Pak Qatar's underwriting results recorded a robust increase due to disciplined risk selection and operational efficiency. In CY24, the claims outstanding were led by higher maturities and surrenders, which created pressure on the cash flows. However, as of 9MCY25, the claims outstanding have also stabilized. Investment income, predominantly from gains on investment revaluation and disposals, supports the profitability. Furthermore, the Company maintains ample liquidity, providing confidence in its ability to meet policyholder obligations. Going forward, improvement in the persistency and expanding market share, diversifying beyond bancassurance, and further strengthening financial metrics remain imperative to rating. The Company holds a stable equity base and has applied for listing at PSX, which further enhances compliance, risk mitigation, and reporting guidelines while simultaneously emphasizing the viability of the business model as well as growth visibility. Prudent business management and consistent investment portfolio returns guided by robust risk mitigation underscore safety for policyholder. PACRA upgrades Pak-Qatar Family Takaful's IFS rating, backed by substantial growth in the Company's GPW, along with holding strong liquidity and a better-quality investment book. This strengthens the Company's ability to manage risk and seize new opportunities. The Company is well positioned to comply with SECP’s enhanced equity requirement of PKR 3bln within the stipulated time limit.
The rating primarily depends on the Company's enhanced competitive positioning. Alongside this, sustained improvement in core and operational profitability is essential to maintaining the rating. Maintaining the surplus in the takaful fund and liquidity position is essential. while continuing to focus on improving profitability. Prudence in risk management, particularly when expanding through the agency model, remains a key consideration.

About the Entity
Pak Qatar Family Takaful Limited (‘Pak Qatar’ or ‘the Company’), a dedicated family takaful provider, began operations in 2007 as an unlisted public company and operates through a network of more than 160 branches. Lately, the Company went into an IPO process, which is expected to complete within Dec-25. Accordingly, major ownership vests with Pak Qatar Investment Ltd. (~34.78%), Qatar Islamic Insurance Group (~6.22%), Qatar International Islamic Bank (~5.64%), alongside H.E. Sheikh Ali Bin Abdullah (~5.77%). Directors and their related families hold (~ 14.39%). The remaining stake is distributed among various individual investors (~11.54%). ~21.67% stake is floated for public offering. The Board is chaired by H.E. Sheikh Ali Bin Abdullah, a member of the Qatar Royal Family. While Mr. Waqas Ahmad head the Company as the CEO with key strength of an experienced team to support smooth operations.