Lahore, December 10, 2021 (PPI-OT):Habib Insurance Company Limited (HIC or the Company), an associated Company of the Habib Group, provides general insurance (Conventional and Takaful) service provider, operating through five core segments, namely; i) Fire and Property ii) Marine and transport iii) Motor iv) Group Hospitalization v) Miscellaneous. Further, the Company benefits from synergy created through group entities, ultimately, channeled through its sponsor group (Habib Group of Companies). The economy revival post COVID-19 picked up the industrial activity, with large scale manufacturing benefitting from the upsurge through bolstered demand for the corporate sector, positively scaling the overall insurance demand.

Further, emerging auto policies are expected to provide a boost to the motor insurance business in the industry prospectively. In line with the economy trend, the positive developments instigated relative GPW growth for HIC, particularly within the fire segment and motor segment, boosting the topline of the Company to PKR 1,422mln for the period ended 9MCY21 (CY20: PKR 1,658mln; CY19: PKR 1,620mln). Enhanced topline, combined with moderate claims and expense management resulted in underwriting results of PKR 94mln for the period ended 9MCY21 (CY20: PKR 121mln; CY19: PKR 101mln). Product innovation and elongated market outreach, capitalizing on the Habib group, bodes well for HIC’s business profile.

A stable investment performance sourced through prime equity investments provided a reliable dividend income stream, contributing PKR 89mln, composing 68.5% of the total investment income, with additional support derived from investment capital gains. The rating acknowledges HIC’s corporate strategy to increase its position on the market by prudent underwriting practices while focusing on bottom-line growth. The financial risk matrix remains adequate, with skewed profile of investment book towards liquid equity investments and secured government securities, along-with a sufficient equity base, providing comfort to the liquidity of HIC.

The rating is based upon sponsor profile and relative position of Habib Insurance Company in the general insurance industry. The future prospects of the Company will require further improvements in business size, underwriting profitability and investment income. As the company grows, the liquid profile must be enhanced.

For more information, contact:
Analyst,
The Pakistan Credit Rating Agency Limited (PACRA)
Awami Complex, FB1, Usman Block New Garden Town,
Lahore, Pakistan
Tel: +92-42-5869504-6
Fax: +92-42-5830425
Email: hammad.rashid@pacra.com
Website: www.pacra.com