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IBI-Rating has affirmed the credit rating of «UPSK» PrJSC at uaAA grade

26.03.2018
Rating agency IBI-Rating informs on affirming of the credit rating of «UPSK» PrJSC at uaAA grade, with a «stable» outlook.

«UPSK» PrJSC has been working in the insurance market since 1992. The majority shareholder and chairman of the supervisory board is Mikhail Mikhailov, who owns 61.74% of the shares. The insurer is a member of the Motor (Transport) Insurance Bureau of Ukraine and has 36 licenses for insurance activities (20 types of voluntary insurance, 16 types of compulsory insurance). Despite the high competition in the Ukrainian insurance market, «UPSK» PrJSC demonstrates a relatively stable position among more than 260 participants of the insurance market (non-life), entering the TOP 20 market leaders in terms of key indicators: the volume of insurance reserves, assets, equity, attracted premiums and made insurance payments. In terms of the volume of attracted premiums under MOTPL contracts during recent years, the Company has consistently been included in the list of the five largest participants in the Ukrainian insurance market. The insurer has a sufficiently developed regional network in all regions of Ukraine. In addition, the Company is represented by about 1000 branches of sale the insurance products and customer service centers operating on the basis of agency agreements.

The positive factors of the insurer's activity should include a substantial stock of assets that may be represented by insurance reserves - as of the end of 2017, the total value of assets of «UPSK» PrJSC, which can be taken into account for covering reserves, exceeds the value of insurance reserves by almost twice times. In addition, the structure of assets, which represent the insurance reserves, is evaluated as good – the share of bank deposits and funds on current accounts is almost amount 82%, the rest is represented by own real estate. In addition, it should be noted that the diversification of bank deposits in the context of banking institutions (including state-owned) is good, indicated banks have determined the credit ratings that correspond to the high investment level of the national rating grade, which reduces the sensitivity to liquidity risk. In turn, an increase in administrative and service costs (agency fees and mediation costs, advertising costs, etc.) have a negatively affects on the indicators of efficiency activity - the net financial result for the 2017 year was negative and amount (-) UAH 25,3 million.

The affirmed rating grade of the Insurer is due to its acceptable capitalization and solvency ratios, high quality and sufficient diversification of the assets, which represent insurance reserves. In turn, the Rating agency notes the loss-making main activity of the company, the high value of the combined loss ratio, and the preservation of a difficult situation in the economy, which limits the financial possibilities of the population and enterprises of the real sector. In turn, the Rating agency notes that the Insurer does not have any debt burden, good quality of reinsurance risk operations, but has a broad client base and well-developed sales channels, which contributes to stable dynamics of insurance premiums.

In order to conduct the analytical research the materials provided by «UPSK» PrJSC , have been used, including: annual financial statements for 2015-2017, other necessary internal information, as well as the information from the public sources, which the Rating agency considers credible.

Financial department

For additional information please contact:
Press office of IBI-Rating
(044) 362-90-84
press(at)ibi.com.ua