Press Release

JCR-VIS Reaffirms IFS Rating of National Insurance Company Limited at AA+

Karachi, December 31, 2008: JCR-VIS Credit Rating Co. Ltd. (JCR-VIS) has reaffirmed the Insurer Financial Strength rating of National Insurance Company Limited (NICL) at ‘AA+’ (Double A Plus) with a ‘Stable’ outlook.

NICL is incorporated as an un-quoted public limited company with 100% shares held by the Government of Pakistan. On account of a captive client base, premium base has shown consistent growth, though the pace of increase has slowed down in recent years on account of privatization of public sector entities. The company is also exploring other areas, as evident by the recent introduction of new products. Furthermore, crop insurance products have also been designed and re-insurance arrangements have also been negotiated for the basic product offering.

Strong results from underwriting operations were posted for 2007, though current year’s performance was adversely affected by claims arising on account of year-end 2007 events taken on books. Profitability indicators have experienced a decline in the on-going year.

The company’s capacity to meet policy holder obligations remains strong, deriving strength from a large capital base and adequate treaty capacities, arranged by Pakistan Reinsurance Company Limited, exclusively for NICL. The company also maintains a large investment portfolio in addition to significant amount of funds held in bank deposits. Investment policy has largely remained conservative, with a large part of the portfolio invested in government securities. Interest rate risk however remains considerable on account of the long term fixed nature of portfolio holdings.

NICL has deployed its newly acquired MIS in branches and at its Head Office. The new system will allow for improved management reporting and facilitate in enhancing controls.

For further information on this rating announcement, please contact Mr. Syed Ziauddin Ahmed (Ext: 508) or Ms. Sobia Maqbool (Ext: 506) at 5311861-70 (10 lines) or fax to 5311872-3.



Faheem Ahmad
President & CEO

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 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 2008 VIS Credit Rating Company Limited . All rights reserved. Contents may be used by news media with credit to VIS .