AM Best Affirms Credit Ratings of Adamjee Insurance Company Limited
The ratings reflect Adamjee's balance sheet strength, which AM Best assesses as adequate, as well as its strong operating performance, neutral business profile and marginal enterprise risk management (ERM).
The negative outlooks reflect pressure on the company's non-life underwriting performance. Whilst Adamjee has a history of robust overall profitability, with profits before tax ranging from PKR 2.3 billion to PKR 8.7 billion between 2020 and 2024, consolidated operating performance has been increasingly supported by the company's life insurance operations and investment activities, with the non-life business generating marginal results. The company's non-life underwriting performance improved in 2024 due to corrective underwriting actions, but was adversely affected by the unprecedented rainfall in the United Arab Emirates, resulting in an overall combined ratio of 99.9%. The company aims to improve the underwriting performance of its non-life book through higher market rates and stringent underwriting practices.
Adamjee's balance sheet strength assessment is underpinned by its risk-adjusted capitalisation at the adequate level, as measured by Best's capital Adequacy Ratio (BCAR). At year-end 2024, risk-adjusted capitalisation declined from the previous year due to higher market values on affiliated investments and significant growth in its non-life portfolio. Investment risk remains the primary driver of required capital, with the investment portfolio highly concentrated in equity securities within Pakistan. Whilst some diversification was achieved through term deposit holdings in the UAE, Adamjee remains exposed to potential capital volatility. In addition, the company has a high dependence on reinsurance and exposure to non-rated reinsurance recoverables through mandatory cessions to the state-owned reinsurer in Pakistan.
Traditionally, the company maintains one of the leading positions in the market, writing a diversified life and non-life portfolio and offering conventional and takaful products. In addition, Adamjee generated close to 40% of its non-life premium income through branch operations in the UAE in 2024, which provides the company with geographical diversification to a more stable country risk environment.
The ERM assessment is viewed as marginal given the size and complexity of Adamjee's operations. The company's operations in Pakistan present exposure to very high levels of economic, political and financial system risks, some of which are beyond the company's control.
This press release relates to Credit Ratings that have been published on AM 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 AM Best's Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best's Credit Ratings. For information on the proper use of Best's Credit Ratings, Best's Performance Assessments, Best's Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best's Ratings & Assessments.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Business Wire
21 minutes ago
- Business Wire
CUPE: Liberals reward Air Canada's refusal to bargain fairly by crushing flight attendants' Charter rights
TORONTO--(BUSINESS WIRE)--Air Canada asked the government to crush underpaid flight attendants' Charter rights, and Jobs Minister Patty Hajdu only waited a few hours to deliver. The Liberal government has invoked Section 107 of the Canada Labour Code to end a strike by Air Canada flight attendants fighting to end unpaid work and poverty wages. "The Liberals have talked out of both sides of their mouths. They said the best place for this is at the bargaining table. They refused to correct this historic injustice through legislation," said Wesley Lesosky, President of the Air Canada Component of CUPE. "Now, when we're at the bargaining table with an obstinate employer, the Liberals are violating our Charter rights to take job action and give Air Canada exactly what they want — hours and hours of unpaid labour from underpaid flight attendants, while the company pulls in sky-high profits and extraordinary executive compensation." CUPE came to the table with data-driven and reasonable proposals for a fair cost-of-living wage increase and an end to forced unpaid labour. Air Canada responded by sandbagging the negotiations. The Liberal government is rewarding Air Canada's refusal to negotiate fairly by giving them exactly what they wanted. This sets a terrible precedent. Contrary to the Minister's remarks, this will not ensure labour peace at Air Canada. This will only ensure that the unresolved issues will continue to worsen by kicking them down the road. Nor will it ensure labour peace in this industry — because unpaid work is an unfair practice that pervades nearly the entire airline sector, and will continue to arise in negotiations between flight attendants and other carriers.
Business Wire
21 minutes ago
- Business Wire
'This government is anti-union and anti-worker': CUPE NS Denounces Use of Bill 107
HALIFAX, Nova Scotia--(BUSINESS WIRE)--CUPE Nova Scotia strongly condemns the federal government's decision to interfere in workers' right to collective bargaining and job action by invoking Section 107 of the Canada Labour Code. 'Clearly, this government is anti-union and anti-worker,' said Alan Linkletter, CUPE Nova Scotia President. 'Forcing workers back on the job instead of supporting free and fair collective negotiations directly contradictions workers' rights that are guaranteed under the Canadian Charter of Rights and Freedoms.' Air Canada has asked the government to crush striking workers' Charter rights, and Federal Labour minister Patty Hajdu is ready to deliver. Hajdu announced that the federal government will be invoking Section 107 at a press conference this afternoon, citing the financial welfare of Canadians and the economy at large as a deciding factor for this decision. 'She says this move is for the financial security of Canadians—are these workers not Canadians? Does their welfare not matter? How can you be financially secure when you don't even get paid for all of the hours you work?' Contrary to the Minister's remarks, this will not ensure labour peace in Canada. This will only push this fight onto the next group of workers in negotiations, while Air Canda's flight attendants continue to work for a billion-dollar company for free. Flight attendants are only paid when the plane is moving, and work as many as 35 unpaid hours a month performing vital duties that ensure the safe and smooth operation of each flight. Now, instead of paying flight attendants for all the hours they work, Air Canada has clearly sought help from the federal government to continue exploiting their employees. 'Minister Hajdu's comments indicate a clear lack of respect for workers' rights,' said Sherry Hillier, President of CUPE Newfoundland and Labrador and National General Vice President for Atlantic Canada. 'By using Section 107 to force workers back on the job yet again, they're setting a pattern. And that pattern is that Liberals don't care about Canadians.' Recent polling data indicates that 9 out of 10 Canadians support Air Canada flight attendants' fight for fair pay. 88% per cent of Canadians believe flight attendants should be paid for all work-related duties including boarding, delays, and safety checks. 76% support raising their pay to reflect the important safety role they play. 59% believe the federal government should respect flight attendants' right to take job action–even if it causes travel disruptions. CUPE represents over 10,000 Air Canada flight attendants across the country, and workers have been demonstrating at Halifax Stanfield International Airport since 6AM. 'Messages of support have been pouring in for these workers from across the country,' continued Linkletter. 'Canadians stand with us. Our elected representatives should, too.'
Business Wire
14 hours ago
- Business Wire
Air Canada-CUPE Negotiations End in Impasse
TORONTO--(BUSINESS WIRE)--Negotiations between CUPE and Air Canada have ended in impasse. Air Canada still refuses to compensate flight attendants for all hours worked. The union has been firm: all safety-related duties should be paid at full hourly rate. Air Canada does not agree. On wages, Air Canada's last offer will still leave flight attendants living below poverty levels for many years to come. We are heartbroken for our passengers. We do not want to go on strike, and we do not want to be locked out, but it is clear that Air Canada has no incentive to bargain. Rather, Air Canada has refused to bargain in good faith due to the likelihood of the federal government using Section 107 of the Canada Labour Code to interfere in negotiations and have a contract imposed by an outside third-party arbitrator.
