From a bare existence until a few years ago, a restructured Crescent Star Insurance Company Limited is now struggling to find a firm foothold in the mainstream insurance sector.

Naim Anwar, Chief Executive Officer Crescent Star Insurance (CSIC), told this writer last Wednesday that in addition to the conventional cover they have offered for decades to corporations in the marine, motor and fire sectors, many insurance companies were now diversifying to cater to the needs of individuals.

CSICL had also reached out to individuals and retail clients through various company schemes such as ‘Seehat Aasaan’, ‘Car Aasaan’ and ‘Travel Aasaan’.

The corporation’s CEO affirmed that the company would continue to concentrate on the core business of insurance but had made inroads in other sectors

Mr Anwar lamented the low insurance penetration and density rate of 0.8pc of GDP in Pakistan, compared with 4.5pc in India and the global average of 8pc. He affirmed that there was a great deal of untapped potential, particularly in health benefit plans — an avenue which ought the masses should be increasingly aware of.

According to the last released quarterly accounts of CSIC for Sept 30, 2016, the paid-up capital of the company stood at Rs827m, which was raised from Rs620m at the same time the previous year.

Mr Anwar said that following the completion of their merger with PICIC and subject to regulatory approvals, the paid-up capital of the company would climb to Rs914m. Total assets of CSIS at Sept 30, 2016 stood at Rs960m.

The corporation’s CEO affirmed that the company would continue to concentrate on the core business of insurance but had made inroads in the food franchising, steel, tracking and technology sectors. CSIC is the holding company of Crescent Star Foods (Pvt) Ltd and Crescent Star Technologies (Pvt) Ltd.

Under its foods subsidiary, CSIC has launched the Texas-based fried chicken chain ‘Golden Chick’ restaurants, with plans to open up 30 outlets in five years. At the time of discussion with this writer Mr Anwar was headed for Lahore to attend the opening ceremony of the second restaurant.

Crescent Foods also holds master franchise rights from UAE principals for ‘Bombay Chowpatty’ restaurants in Sindh and Balochistan.

Crescent Star Technologies (Pvt) Ltd was set up to undertake tracker/software programming business and call centre operations.

Outside the above, the company’s largest investment, amounting to Rs422m is in Dost Steels Limited. Envisioned, at the time of its incorporation, as the country’s largest re-bar rolling mill with a capacity of 350,000 tonnes per annum, DSL fell upon bad times. The financial problems are being resolved and the steel mill is expected to go into operation by May this year.

For the latest released accounts for nine months ended Sept 30, 2016, CSICL reported a profit after tax at Rs5.26m. The gross premium written for the nine months amounted to Rs166.1m, 21.6pc lower than the gross premium of Rs211.9m in the corresponding three-quarters of the previous year.

Directors were not worried over the drop and said it was in line with the management strategy not to renew many corporate accounts for health businesses (due to a very high loss ratio).

With regards to future plans, directors asserted: “The management strategy is to move towards individual accounts in sectors of untapped market for health, backed by technology through the company’s subsidiary Crescent Star Technologies (Pvt) Ltd, providing call centre and tailor made software for back end control”.

The directors also stated that the company had released new technology based Motor Underwriting offers, which would be launched through aggressive selling and new distribution channels.

Directors also complained that insurance companies were still haunted by banks. “The banks continue to violate the Insurance Ordinance and fair competition by enlisting companies (of their choice and issuing bank limits) without any fair and spoken criteria”, they said, but added that it was encouraging to note that the Competition Commission of Pakistan had taken notice of long outstanding issue of Bank Enlistment and Limits.

“It is to be hoped that with this intervention justice may prevail and the fundamental right of doing business is given to all registered, legitimate, Insurance companies meeting all compliances”, directors said, adding that the CSICL had actively taken up the issue at all forums where assistance could be requested to resolve one of the major constraints of insurance penetration.

Regarding future plans, the CEO of CSICL told this writer last Wednesday that another fully-owned subsidiary by the name of Crescent Star Luxuries (Pvt) Ltd was positioned to launch retail stores to market cosmetics, perfumes and luxury items under the brand name of ‘Define’. The company planned to open doors to the first retail store in March 23, this year.

Published in Dawn, Business & Finance weekly, February 6th, 2017