Research Analyst
Sep 19 - 25, 2011

Adamjee Insurance Company Limited (AICL) was incorporated as a public limited company in 1960 and is listed on all three stock exchanges of Pakistan. The company is also registered with the central depository company of Pakistan limited (CDC) and involved in the business of general insurance.


INDICATORS 2010 2009
Fixed Assets 1,101 1,050
Total Assets 27,887 21,612
Total Liabilities 16,852 10,831
Gross Premium 11,564 10,321
Net Premium 6,883 6,807
Profit Before Tax 577 2,595
Profit After Tax 519 2,434

AICL comprises of insurance originators with superior management teams, sustainable competitive advantage and is fully equipped with identifiable value enhancement opportunities. The company has originated volumes across the spectrum of businesses, entered joint partnerships with key players in the financial sector and expanded its business across Pakistan and Dubai.

The diversity of AICLís portfolio allows the company to be the insurer of choice, for an array of clients and needs. While expanding the customer base, AICL dedicates as much effort in maintaining the highest level of customer satisfaction. Its cornerstone philosophy is to provide premium quality service along with forwarding the maximum benefit to its clients.

This commitment is exhibited in the importance AICL places on excellence, integrity and ethical behavior. These values foster confidence, especially in their clients for whom security is imperative. The high level of confidence AICL inspires is evident in the number of banking and financial sector clients that AICL insures.

In addition, AICL insures sensitive petrochemical and complex industrial risk projects of great value. AICL specializes in insuring engineering and telecom concerns, whereby it has secured the greatest share of clients in those sectors. On the other end of the spectrum, AICL services the primary industries of Pakistan by covering several cement factories as well as numerous textile and sugar mills. Assuming the role of a leader in Pakistan's insurance industry, AICL pioneered the coverage of energy risks. AICL has also secured the business of foreign concerns entering Pakistan to execute and assemble construction or infrastructure development projects. AICL is the principal insurer of kidnap & ransom, professional indemnity, product liability and other specialized lines.

The company won the consumer choice award 2010 category for best general insurance company.

Like year 2009, the year 2010 also proved very challenging for the company due to the prevailing weak economic situation. The worst ever floods with devastating effects on the economy had severe impacts on the budgetary projections for the 2010 leading to slowdown of the economic growth and investment in the country.

During the year 2010, the company has underwritten a gross premium of Rs11,564 million and showed a growth of 12 per cent over the corresponding last year. The net premium retention was 60 per cent amounting Rs6,883 million of total gross premium underwritten as compared to the net premium retention of 66 per cent amounting Rs6,807 million in 2009. The claims ratio of the company stood at 70 per cent in 2010 against 65 per cent in 2009, due to natural catastrophe in shape of floods. The overall underwriting profit declined by 59 per cent compared to last year showing amount Rs280 million in 2010 against Rs679 million 2009.

High claim ratio and lower net investment income has impacted on the bottom line showing net income of Rs519 million in 2010 against Rs2,434 million in 2009.

The company's motor insurance policy ensures that the car owner is protected from financial losses, caused by damage or theft to the vehicle and third party liability.

During 2010, the company underwrote a gross premium of Rs3,646 million which contributes 32 per cent of the total portfolio. The net claim to net premium ratio in 2010 was 68 per cent (2009: 70 per cent).

The company is one of the largest health insurance providers catering to the health and medical needs of the corporate and SME sectors for employees with customized benefits structure and value added services. The fire and property insurance policy provides compensation to the insured person or firm in the event of damage to the property insured caused by fire, lightning. This class of business constitutes 37 per cent of the total portfolio. AICLís marine, aviation and transport insurance cover damages to the shell and machinery of the vessel, cargo carried on the vessel, and also offer protection against liabilities to shipping and transport related companies. It constitutes 10 per cent of the total portfolio.

International SOS is the AICLís global partner of providing the medical benefits and services for their travel product "Faaslay Asaan". It has a worldwide presence with over 51 offices and 27 alarm centers spread across the globe including Europe. International SOS outsourced customer care services extend beyond the boundaries of medical assistance, using the sophistication of their alarm center network for concierge, home, automobile, wellness services and a range of hotline assistance services.


Pakistan is on the frontline of fight against terrorism. Outbreaks of violence in Pakistan are fairly common. Some of these have prompted significant insurance losses. Thus, increasingly high instability poses high risks to Adamjee insurance company in terms of higher claim rates. The company should focus on increasing its underwriting base and improving operations to strengthen the business.