REPORT OF THE DIRECTORS TO THE SHAREHOLDERS

The Directors have pleasure in presenting forty-eighth Annual Report together with the Company's Audited Accounts and Auditors' Report thereon for the year ended December 31,2001.

The results of the Company have shown sustained growth during the year 2001. The management continued its focus on prudent underwriting, improvement in quality of service, enhancing the financial strength and observance of high ethical standards. A summary of the results is given below indicating the performance for the year under review:

The Gross Premium (GP) written for the year 2001 at Rs. 247 million increased by 9% against 228 million of 2000. This increase of 9% was substantial keeping in view the prevailing economic conditions. The share of Fire, Marine and Motor & Miscellaneous Departments was 39%, 26% and 35% respectively.

The income from investments continued to increase and this year the growth was 42%. The income from dividends, deposits, capital gain and other income amounted to Rs. 123 million as against Rs. 88 million of the last year. The profit before tax and provision for diminution in value at Rs. 160 million increased by 11% over Rs. 144 million for the year 2000. The profit after tax and before provision for diminution in value, at Rs. 143 million increased by 62% over Rs. 88 million of last year. The charge for income tax was adjusted for the excess provision of the last year, which amounted to Rs. 21 million. The decision of the Government to reduce the tax rate on dividend income has been welcomed by the Insurance Industry. These changes have contributed to improvement in profitability of the Company.

The strategy of accepting selective risks while expanding the customer base will be continued. The long term goals of increasing our presence, enhancing the customer satisfaction coupled with the diversified investment activities are the driving forces of our Vision 2010. Our Company's Insurer Financial Strength (IPS) rating of "AA" (double A) assigned by The Pakistan Credit Rating Agency Private Limited (PACRA) also affirms the strength of our Corporate Policy and Vision 2010.

 

Munnawar Hamid QBE                                   Syed Hyder Ali
Chairman                                                      Chief Executive

Karachi: March 01, 2002.