Karachi, November 05, 2021 (PPI-OT):VIS Credit Rating Company Limited has reaffirmed the Insurer Financial Strength (IFS) rating of ‘AA’ (Double A) of IGI General Insurance Ltd. (IGI General). The rating signifies very high capacity to meet policyholders’ and contractual obligations. Risk is considered modest but may vary slightly over time due to business /economic conditions. Outlook on the assigned rating is ‘Stable’. The previous rating action was announced on December 30, 2020.

Ratings assigned to IGI derive strength from association with its primary shareholder, growth in business volumes, penetration of un-tapped market segments, hiring and training of new sales team and re-enlistment and enhancement of limits with banks. New business generation has been a challenge in the outgoing year given the slowdown in economic activity due to COVID-19 outbreak; however, gross premium written exhibited positive momentum and stood at a higher level in HY21 as compared to the preceding year. The rating further incorporates reinsurance arrangements largely with counterparties having sound credit risk profiles with appropriate risk retention on net account to maintain risk appetite of the company. The comfortable liquidity profile continues to support the rating. Loss ratio deteriorated on a timeline basis primarily on account of higher incidence of claims in the fire segment.

On the other hand, insurance debt in relation to gross premium has declined on a timeline basis in line with growth in scale of operations; the same now falls within the benchmark criterion of the assigned rating. The aging of receivables is also considered satisfactory. Assigned rating also accounts for the stability and expertise of the management team in the insurance sector. The investment risk in equities would be tracked over time. Moreover, the rating remains sensitive to increase in operating and financial leverages; the same remain higher than the rating benchmark. Going forward, achieving growth in market share while maintaining underwriting quality and profitability metrics would be an important rating driver.

For more information, contact:
Director Compliance and Rating Analytics,
VIS Credit Rating Company Limited
VIS House, 128/C, 25th Lane off Khayaban-e-Ittehad,
Phase VII, DHA, Karachi, Pakistan
Tel: +92-21-35311861-72
Fax: +92-21-35311873
Email: bilal@jcrvis.com.pk
Website: https://www.vis.com.pk/