Press Release

JCR-VIS has upgraded the IFS rating of New Jubilee Life Insurance Company Limited to AA-

Karachi, January 24, 2011: JCR-VIS Credit Rating Company Limited has upgraded the Insurer Financial Strength (IFS) rating of New Jubilee Life Insurance Company Limited (NJLI) to ‘AA-’ (Double A minus) from ‘A+’ (Single A plus). Outlook on the rating is ‘Stable’.

NJLI is part of the Aga Khan Development Network, which also comprises Habib Bank Limited (HBL) and New Jubilee Insurance Company Limited who are major players in the banking and general insurance sectors. During FY09, NJLI’s market share crossed the 10% mark. NJLI has been able to post growth of nearly 27% compared to around 20% growth posted by the overall sector during last year, due to presence of strong group synergies and an established franchise value. The rating takes into account strength and support of the company’s sponsor group. Bancassurance business from HBL is a major driver of overall growth. Growth trends have continued in 2010.

In addition to growth in premiums through improvement in productivity of direct sales force and growth in bancassurance business, overall persistency has also improved. Major proportion of business pertains to unit-linked individual life insurance policies. In view of the uncertain economic environment and high returns on government securities fresh liquidity was directed towards this avenue leading to significant increase in its proportion in the overall investment mix. Resultantly, performance of funds associated with life insurance policies has also improved in FY10. While there has been improvement in loss ratios in the individual segment due to decline in surrender rate, loss ratios in group segment continue to be notable, though the management is making efforts to control the same.

As life insurance penetration is still very low, there is significant room for further growth particularly in the retail segment; however, high inflation and decline in disposable income levels pose a challenge for life insurance companies. Product innovation and focus on client retention and sales force efficiency will remain key drivers for continued growth.

For further information on this rating announcement, please contact Syed Ziauddin Ahmed (Ext: 508) or Mr. Zia Usmani (Ext: 507) at (+92-21) 35311861-70 (10 lines) or fax to (+92-21) 35311872-3.

Javed A. Callea

Information herein was obtained from sources believed to be accurate and reliable; however, JCR-VIS Credit Rating Company Limited (JCR-VIS) does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information. JCR-VIS, the analysts involved in the rating process and members of its rating committee do not have any conflict of interest relating to the rating(s)/ranking(s) mentioned in this report. JCR-VIS is not an NRSRO and its credit ratings are not NRSRO credit ratings. JCR-VIS is paid a fee for most rating assignments. This rating/ranking is an opinion and is not a recommendation to buy or sell any securities. Copyright 2011 JCR-VIS Credit Rating Company Limited. All rights reserved. Contents may be used by news media with credit to JCR-VIS.

JCR-VIS Credit Rating Company Limited