KARACHI:VIS Credit Rating Company Limited has reaffirmed IFS rating of double A of IGI General Insurance Limited. 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 Dec. 30, 2020,” said a press release on Friday.
The 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 higher level in the first half of 2021 as compared to the preceding year.
The rating further incorporates reinsurance arrangements largely with counter parties 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 time line 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 time line basis in line with growth in scale of operations; the same now falls within the benchmark criterion of the assigned rating.