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The Pakistan Credit Rating Agency Limited
Press Release

Date
23-Feb-24

Analyst
Nabia Rauf
nabia.rauf@pacra.com
+92-42-35869504
www.pacra.com

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This press release is being transmitted for the sole purpose of dissemination through print/electronic media. The press release may be used in full or in part without changing the meaning or context thereof with due credit to PACRA

PACRA Maintains IFS Ratings of IGI General Insurance Limited

Rating Type IFS
Current
(23-Feb-24 )
Previous
(23-Feb-23 )
Action Maintain Maintain
IFS Rating AA+ (ifs) AA+ (ifs)
Outlook Stable Stable
Rating Watch - -

Pakistan's general insurance industry has a total size of PKR 166bln during 9MCY23 (9MCY22: PKR 113bln), exhibiting a growth of ~47%, in terms of Gross Written Premium (GWP). The industry reported a growth of ~266% in underwriting results (9MCY23: PKR 9.9bln, 9MCY22: PKR 2.7bln). The net income of the industry also experienced an increase of ~170% to PKR 20bln during 9MCY22 (9MCY22: PKR 7.4bln). Overall, the industry overall outlook remains stable with substantial liquidity available with players.
The ratings derive comfort from the strong backing and governance instituted by the Sponsors - the Packages Group through IGI Holdings. Moreover, a prudent approach of management to sustain the overall quality and control environment remains imperative for the ratings. IGI General Insurance Limited holds a stable risk profile. The topline of the Company is mainly inflationary driven with slightly increased business volumes. During 9MCY23, the Company generated consolidated GPW of ~PKR 11bln (9MCY22: ~PKR 8bln), witnessing a growth of ~39%. Fire and property segment contributed ~41%, followed by motor ~19%, miscellaneous ~18%, accident & health ~13% and marine & transport ~8% of the total GPW. Underwriting performance witnessed a surge and the Company secured a profitable bottom-line, gaining support from the investment income. Going forward, an increased inclusion of digitization may support the overall business volumes. On the financial risk front, the Company holds adequate liquidity; however, considerably higher claims further stress the efficiency. The equity base remains stable.
The rating is dependent on sustained improvement in business and financial metrics of the Company in line with its relative positioning within the industry. At the same time, the liquidity profile should continue to offset the liabilities.

About the Entity
IGI General Insurance Limited ('IGI General' or 'the Company') was incorporated on 18-Nov-16, as a public unlisted concern. The principal activity includes managing non-life insurance through Conventional and Window Takaful in Fire and Property, Marine, Accident and Health, Motor and Miscellaneous segments
The Packages Group through IGI Holdings holds ~100% stake in the Company. The Board is chaired by Mr. Shamim Ahmad Khan, while Mr. Faisal Khan serves as the Company's CEO. He is assisted by a team of experienced professionals.

The primary function of PACRA is to evaluate the capacity and willingness of an entity to honor its obligations. Our ratings reflect an independent, professional and impartial assessment of the risks associated with a particular instrument or an entity. PACRA's comprehensive offerings include instrument and entity credit ratings, insurer financial strength ratings, fund ratings, asset manager ratings and real estate gradings. PACRA opinion is not a recommendation to purchase, sell or hold a security, in as much as it does not comment on the security's market price or suitability for a particular investor.