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A.M. Best Affirms Credit Ratings of Jubilee General Insurance Company Limited

A.M. Best has affirmed the Financial Strength Rating of B+ (Good) and the Long-Term Issuer Credit Rating of “bbb-” of Jubilee General Insurance Company Limited (Jubilee) (Pakistan). The outlook of these Credit Ratings (ratings) is stable.

The ratings reflect Jubilee’s balance sheet strength, which A.M. Best categorises as strong, as well as its strong operating performance, limited business profile and appropriate enterprise risk management.

Jubilee’s balance sheet strength is underpinned by very strong risk-adjusted capitalisation, as measured by Best’s Capital Adequacy Ratio (BCAR), and supported by good internal capital generation. The company’s paid-up capital increased in 2017 to PKR 1.8 billion (USD 16.4 million) from PKR 1.6 billion (USD 15.2 million) in 2016.

Offsetting rating factors for the company’s balance sheet strength assessment are Jubilee’s investment portfolio, which is restricted by regulation to domestic assets, and its exposure through mandatory cessions to the non-rated state reinsurer. A.M. Best expects prospective balance sheet strength to remain at a strong level over the medium term, supported by continued good internal capital generation.

Jubilee has a track record of strong operating performance, with a five-year average return on equity of 19.2% (2013-2017). Over the same period, the company delivered a robust average combined ratio of 91.1%, demonstrative of Jubilee’s prudent underwriting discipline. Despite strong technical results, investment income dominates the company’s operating profits. In 2017, the company achieved profits before tax of PKR 1.6 billion (USD 14.7 million), a modest decrease from PKR 1.9 billion (USD 17.9 million) in 2016.

As Pakistan’s third-largest non-life insurer, Jubilee maintains a good competitive position in its domestic market. The company writes a diversified portfolio, offering conventional and Takaful products. Jubilee seeks additional market share through the development of its retail operations, which are expected to benefit from the company’s innovative online platforms as the company adopts a forward thinking approach to underwriting.

This press release relates to Credit Ratings that have been published on A.M. Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see A.M. Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Understanding Best’s Credit Ratings. For information on the proper media use of Best’s Credit Ratings and A.M. Best press releases, please view Guide for Media - Proper Use of Best’s Credit Ratings and A.M. Best Rating Action Press Releases.

A.M. Best is a global rating agency and information provider with a unique focus on the insurance industry. Visit www.ambest.com for more information.

Copyright © 2018 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.

Contacts:

Emily Thompson
Associate Financial Analyst
+44 20 7397 0291
emily.thompson@ambest.com

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