PACRA Maintains IFS Rating of Habib Insurance Company Limited

The rating derives comfort from the stable standing of Habib Insurance Company Limited ("Habib Insurance" or "the Company") in the general insurance industry, which holds a total size of PKR 48bln during 3MCY24 (3MCY23: PKR 41bln), posting growth of ~17%. Imporved underwriting results along with better investment performance supported the industry's earnings (3MCY24: PKR 6.3bln, 3MCY23: PKR 4bln). However, current economic conditions remain imperative for the overall performance of the insurance industry. Habib Insurance gathers support from the House of Habib ("the Sponsors"). Well-framed governance structure and prominent position of the Sponsors in various businesses generate captive business for the Company; however, the share remains minimal in the overall GPW. Habib Insurance manages conventional and window takaful businesses and has shown a stable trajectory in GPW over the years; mainly emanating from motor along with fire and property, followed by marine & transport, health, and miscellaneous segments. The recent growth of ~21% in GPW reflects a value driven impact with minimal volumes following in. However, higher claims have led to stressed underwriting results with a high combined ratio. Adequate investment income, emanating mainly from equity investments, supports the Company’s bottom line. Going forward, an increased inclusion of digitization may support the overall business volumes. On the financial risk front, the Company holds adequate liquidity. This along with the strong-rated reinsurer panel supports the Company. However, considerable standing of claims impacts efficiency. The Company's equity base remains stable.
The rating is based on the Sponsor's profile and the relative position of Habib Insurance in the general insurance industry. A cautious approach to improve the business volumes that support the underwriting results remains critical. Growth in the investment income, along with an enhanced liquid profile is imperative for the rating.

About the Entity
Habib Insurance Company Limited ("Habib Insurance" or "the Company") was incorporated in 1942 as a public listed company. 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 major stake of the Company lies with the House of Habib (~70.8%), mainly through the Trust and Individuals. The Company's Board is chaired by Mr. Rafiq M. Habib; while Syed Ather Abbas serves as the Company's CEO. He is assisted by a team of professionals.