Petrolimex Insurance profits from low-loss property and marine lines

PJICO follows a conservative investment strategy, with most investments held in deposits.

Petrolimex Insurance Corporation (PJICO) is seen to maintain its balance sheet strength, supported by risk-adjusted capitalisation, at its strongest level in the medium term, according to AM Best.
 

The company is projected to maintain solid internal capital generation to support planned business growth. 

PJICO follows a conservative investment strategy, with most of its investments held in cash and term deposits. 

It also relies moderately on reinsurance to support its underwriting capacity, particularly for large property and engineering risks, as well as to manage catastrophe exposure. 

This dependence is partially offset by the strong credit quality of its reinsurance panel.

The company’s operating performance is assessed as adequate, with a five-year weighted average return on equity (ROE) of 12.7% and a combined ratio of 96.9% from 2019 to 2023. PJICO's earnings are primarily driven by stable investment income. 

However, the company’s underwriting margins were thinner in 2023, largely due to a higher loss ratio in the health insurance segment. 

On the other hand, its commercial lines, including property and marine cargo, have been profitable with low net loss ratios and strong reinsurance commission income. 

The company’s elevated expense ratio continues to be a factor limiting its performance. 

Additionally, the impact of Typhoon Yagi, which struck Vietnam in the third quarter of 2024, may add volatility to PJICO’s underwriting results, though this is expected to be mitigated by its reinsurance program.