It is my distinct pleasure to place before you, on behalf of the Board of Directors of East West Life Assurance Company Limited, the 23rd Annual Report together with the audited financial statements of the company for the year ended December 31st, 2015.


Pakistan is at an important juncture of its history. But sometime it is quite contrary to one’s expectations what is happening in the world economy these days as the fight between the oil giants is getting worse. Oil prices in the world market are facing the worst slump of recent history. From a high of $115 per barrel in June 2014 and maintaining nosedived trend of price cut, the prices have gone down to $40 in December 2015.


The present reduction simply means boon for all developing economies while the increase in the consumer’s pockets raises demand for almost everything. It also means lower cost of production and prices that are affordable by more people from farmers sowing wheat for home consumption to industrialists filling apparel export orders passing benefit to almost everyone. It is also good news for Government of Pakistan looking to weather the ever worsening energy crisis. It can reap its benefits in both economic and political spheres. The oil prices will help reduce cost of energy and is likely to ease out load-shedding.


The fight against terrorism in Pakistan has gone into top gear and it seems the pressure has been released to quite an extent for the law enforcing agencies. It is finally moving forward and has shown ample signs of force and resolve with which it intends to march ahead. But let us not be deceived. Terrorism as we Pakistani have lived through over past decades is not about a group of rouge, violent and misguided elements. It has taken deep roots in society, its polity and its economy as well. However, we have to define the way we perceive nationalism and decide for us which Pakistan we wish to live in.


In terms of profitability, 2015 was a difficult year for your company. However, despite of this fact, some important financial targets were achieved, including:
  • The first year individual life premium grew more than 49%. This is good news for the company as the 1st year portfolio had been shrinking for the last few years.
  • The 2nd year individual life premium increased in 2015 by more than 22% with 2nd year persistency of 60%.
  • The claim expenses of the company have reduced by more than 39% in 2015 to Rs. 73.7 million from approximately Rs. 121 million in 2014.
  • Total gross claims have decreased by more than 51%, which is an excellent achievement for Claims Officers of the company.
  • The company’s total net management expenses have reduced by almost 15% from Rs. 64.65 million in 2014 to approximately Rs. 55 million during 2015.
  • The management’s persistent hard work to control excessive costs has resulted in exceptional reduction of statutory fund management expenses exceeding 13% in 2015.
  • The management’s cost controlling efforts have also resulted in reduction of shareholders’ fund expenses by more than 19% in 2015 to Rs. 13.9 million from Rs. 17.24 million in 2014.
  • As a result of premium income reduction, the company’s total acquisition costs have also decreased by 50% in 2015 from Rs. 16.97 million to less than Rs. 8.5 million.
  • The amount of investment has increased by 7.1% in 2015 from Rs. 284.9 million to Rs. 305.1 million, which indicates the strong base of your company.


It has become the key focus of the company to enhance profitability by increasing net premium results and further controlling expense while keeping in view the essential task of continued improvement in claim results.


In 2016 and beyond, the management is planning to focus on improving internal controls and constituting concrete policies to achieve continued reduction in claims, improve premium growth (especially on the front of individual and group life insurance) while instituting steps to further reduce expenditures.


It is expected that in order to achieve these tasks, the company will need to enhance marketing field force under close supervision, use new business procurement channels, develop unique target based products and improve Human Resource mobilization as well as utilization while promoting a professional environment and corporate culture. Moreover, necessary modification of departmental structures will also be implemented to maximize efficiency and enhancement of management tools.


Moreover, the focus of the company’s management will be on the following areas for the future:
  • Focus on development of new products in line with principles of Microinsurance.
  • Addition of value-added services to our individual and corporate clients using the company’s Information Technology (IT) department.
  • Implementation of controls through customized IT solutions in each area/level of transactions to improve overall working of the company.
  • Improve cost management of company’s branch offices throughout the country with focus on business procurement expense control.


With a view to further maximize returns for policyholders and shareholders of the company, the management’s job in 2016 is to continue improvement in the financial results of the entity. The board is certain that, in view of the improving economic situation globally and within the country, your management is keenly focused on the above targets, which (InshaAllah) will result in further improvement of the financial results while developing an enhanced corporate culture within the organization. I am certain that the management’s direction for the future will be mutually beneficial for the policyholders and shareholders of the organization.


Further, the Army Welfare Trust has also shown its intention to acquire majority share holding of the company.


I would like to take this opportunity to express my sincere thanks to The Ministry of Commerce, Government of Pakistan, and the Securities and Exchange Commission of Pakistan (SECP) for their continued direction and support given in managing the affairs of the company in a prudent manner. The directors wish to record their appreciation for the tremendous contribution made by the able and eminent officers, staff and sales force of the company towards its development and growth. Their continuous commitment to high ethical standards, client service and hard work has helped your company emerge and maintain its position as a key member amongst private sector life insurers.


Moreover, we also wish to thank the Insurance Association of Pakistan (IAP) for their assistance and valued representation of our industry. We would also like to sincerely express our gratitude to the company’s loyal policyholders and corporate clients for their continued support and confidence in our company.


Lastly, my thanks and appreciation to the thousands of our shareholders, whose enthusiasm for the company is a source of confidence for us to make East West Life a sound and reliable financial organization and a symbol of security for the marketplace.


May Almighty Allah bless us all (Ameen).


On behalf of the Board of Directors,



Karachi, March 28th, 2016
This Page Last Updated on April 9, 2016
email spam checker