Lahore, March 03, 2021 (PPI-OT): The rating captures the solid fundamentals of the company. Adamjee Insurance Company Limited has exhibited sustained growth in the business profile while maintaining operational efficiency, reflecting positively in the core profitability. The stability in the management team and concerted efforts are laudable. Adamjee Insurance Company Limited continues to enjoy the perk of being the only general insurance company with operations outside Pakistan. The overseas business took a dip as a result of COVID-19; however, it has witnessed strong recovery since June 20. The combined ratio continues to witness stability.
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 micro insurance. Furthermore, Adamjee Insurance Company Limited keeps an eye on opportunities geographical diversification in other regions. The rating incorporates the effect of association of Adamjee Insurance Company Limited with Nishat Group.
Prior to COVID-19, the general insurance industry witnessed a growth of 11% YoY. The current pandemic affected the volumes, which led to a contraction in the growth. However, business volumes have picked up post-June 2020 amidst revival of economic activities throughout the country. The business volumes need to sustain, indeed, improve in tandem with the longer historical trend.
The lower interest rate regime has added momentum to auto-financing, which is a good sign for the insurance industry. The rating depends on the stability and continuous efforts of the management team to execute the business plan. Adamjee Insurance Company Limited should continue to strengthen its market position along with its underwriting profits.
For more information, contact:
The Pakistan Credit Rating Agency Limited (PACRA)
Awami Complex, FB1, Usman Block New Garden Town,
Lahore – Pakistan
Tel: +9242 586 9504 -6
Fax: +9242 583 0425
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