Karachi, March 20, 2017: JCR-VIS Credit Rating Company Ltd. (JCR-VIS) has assigned initial Insurer Financial Strength (IFS) rating of ‘A+’ (Single A Plus) to Allianz EFU Health Insurance Limited (AEFU). Outlook on the assigned rating is ‘Stable’.
The rating assigned to AEFU derives strength from the sponsor profile of Allianz SE, a Germany-based financial services provider and holding company of the Allianz Group (Allianz SE rated AA by Standard & Poor’s and A+ by A.M.Best). The group is present in more than 70 countries with major operations in Europe. Prominent shareholders of AEFU also include EFU Services (Pvt.) Limited.
The company is led by a team of well-qualified professionals possessing rich experience in the health insurance industry. AEFU has exhibited steady growth over the years while maintaining an adequate risk profile. The rating also draws comfort from its pro-rata reinsurance treaty with Pakistan Reinsurance Company Limited. Enhanced focus on underwriting quality has allowed the company to report a healthy bottom line over the three-year horizon. Moreover, given the nature of business, mobilization cost compares favorably to companies in the general insurance industry.
The rating takes into account positive results from underwriting operations and liquidity profile of the institution. Rating is constrained by the competitive environment in which the company operates and concentration in the business profile. With growth in business volumes, leverage indicators of the company have trended upwards. Rating, going forward, will take into consideration improvement in capitalization and dividend policy which provide for a healthy internal capital growth.
AEFU has a structured investment management and oversight mechanism in place. IT infrastructure in place includes an internally developed ERP system and an Oracle database.
For further information on this rating announcement, please contact Mr. Javed Callea (Ext: 201) or the undersigned (Ext: 207) at 021-35311861-71.
Jamal Abbas Zaidi
Applicable Rating Criteria: General Insurance (March 2017)
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