Press Release

JCR-VIS Reaffirms IFS Rating of Chubb Insurance Pakistan Limited

Karachi, December 31, 2018: JCR-VIS Credit Rating Company Limited (JCR-VIS) has reaffirmed the Insurer Financial Strength rating of Chubb Insurance Pakistan Limited (CIPL) at ‘AA’ (Double A). The rating signifies very high capacity to meet policyholder and contract obligations. Risk is considered modest but may vary slightly over time due to business /economic conditions. Outlook on the assigned rating is ‘Stable’. Previous rating action was announced on December 29, 2017.

The assigned rating of CIPL derives strength from the Chubb Group, one of the world’s largest multiline Property and Casualty insurers with operations in 54 countries. Sponsor support of the company is demonstrated through both the technical and financial support provided by the group. CIPL is a wholly owned subsidiary of Chubb INA International Holdings, Ltd. USA; ultimate parent of the group entities, Chubb Limited is rated ‘AA’ by an international rating agency.

Rating takes into account the competitive environment in which the company operates. The company’s strong risk adjusted capitalization level is evident from strong treaty protection, low leverage indicators, conservative investment profile, sound liquidity indicators and one of the lowest combined ratios in the industry. Sizeable treaty capacities, which are favorable in comparison to peers, allow CIPL to underwrite larger risks while prudently managing exposures. Reinsurance treaties of the company include risk coverage for both inside and outside Pakistan, enabling the portfolio to be geographically diversified. The company also benefits from the groups’ experience in underwriting.

The company continues to maintain a diversified portfolio mix with fire and property contributing the highest share. During the years, management has maintained a prudent underwriting approach with regards to its portfolio. As a result, CIPL’s strategy translated into variability in the top line. Nevertheless, its business strategy resulted in a positive bottom line. With anticipated growth in business in the coming years, management expects to maintain its underwriting profitability at similar levels. Combined ratio of the company improved notably to 56.9% (FY17: 75.4%, FY16: 101.0%) in HCY18. Ability to maintain these profitability indicators of the company will need to be monitored over time.

For further information on this rating announcement, please contact the undersigned (Ext: 207) or Mr. Javed Callea (Ext: 201) at (021) 35311861-70 (10 lines) or fax to (021) 35311873.

Jamal Abbas Zaidi

Applicable rating criterion: Methodology - General Insurance (March 2017)

Information herein was obtained from sources believed to be accurate and reliable; however, VIS Credit Rating Company Limited 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.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.VIS is not an NRSRO and its credit ratings are not NRSRO credit ratings.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 2018 VIS Credit Rating Company Limited. All rights reserved. Contents may be used by news media with credit to VIS.

JCR-VIS Credit Rating Company Limited