The rating reflects MIC's improving profitability, sound underwriting practices and premium growth. With business from group companies constituting a high proportion of total business, the company continues to benefit from lower loss ratios. This is mainly due to the tradition of effective systems of asset maintenance by group companies.
The company's financial base is sound owing to a healthy retention policy, allowing MIC to target a higher level of growth, going forward. Adequate due diligence is also being paid to risk management systems given the management's growth strategy encompasses a renewed emphasis on obtaining non-group business.
Muslim Insurance Company Limited (MIC), one of the oldest insurance companies in Pakistan, commenced commercial operations in 1934 as a life insurance company. However, after nationalisation of life insurance in 1972, MIC was restricted to non-life insurance business.
The company went public in 1955 and is listed on the Karachi and Lahore stock exchanges. The Atlas Group--one of the well-known business groups in the country with diversified interests including car production, motorcycle production, auto parts manufacturing, investment banking, insurance, and trading--is the majority shareholder in MIC.
Overall control of the company vests in the Board of Directors, comprising seven members, mainly representing the Atlas Group. The current chief executive--previously working in the capacity of chief operating officer in MIC--assumed the position in 2004. He has extensive exposure to the insurance sector, and is also Chairman of Insurance Association of Pakistan.
MIC underwrites all types of non-life insurance business including fire, marine, motor and miscellaneous risks. While efforts are being made to improve the productivity of existing branches, the management is also targeting a further increase in the branch network.