PACRA Maintains IFS Rating of Reliance Insurance Company Limited

Reliance Insurance Company Limited's ("Reliance" or “the Company") IFS rating derives strength from its association with the renowned sponsoring Groups, Al-Noor and Amin Bawany. Both Groups operate diversified businesses that add strength to the Company's overall policy framework. Reliance provides conventional insurance (~89% of the overall business), along with operating a Takaful window. Over time, the Company has shown organic growth with minimal support from captive business. Reliance's GPW (Gross Premium Written) grew in line with the industry, reflecting growth of ~29%, and majorly (~56.4%) trickling in from the fire segment only. Thus, the segmental concentration remains elevated. Core income remains steady; while a significant uptick in investment returns supplemented the Company's overall performance. This growth was attributed to the revival of the equity market, as the majority (~77%) of investment tilted towards equity instruments. The Company aims to diversify its focus towards the motor segment to support the market share and manage concentration. Moreover, the investment book might require attention according to the current shift in market returns. The financial risk profile is characterized by an adequate liquidity position backed by considerable liquid assets. Moreover, the Company maintains adequate risk appetite evident from the agreed treaties with credit-worthy and well-known reinsurers. Enhancing pure equity, though gradual, remains important to rating, going forward.
The rating is dependent on the Company’s ability to improve its market position with continued profitability. The liquidity position and hence, financial risk profile should remain afloat with growth. Sustained underwriting profits along with equity enhancement remain crucial, going forward.

About the Entity
Reliance Insurance Company Limited ("Reliance" or “the Company") was incorporated as a Public Listed Company (listed on PSX) in 1981. Principal activity involves managing non-life insurance through conventional and window takaful operations in fire and property mainly.
The Company is majorly (~64%) owned by Al-Noor and Amin Bawany Groups. Mr. Irfan Zakaria Bawany chairs the Board; while, Mr. A. Razak Ahmed is the CEO/MD of the Company. He is assisted by an experienced management team.