KARACHI - All the key listed non-life insurance companies have posted profits of Rs933 million in first quarter 2008 as compared to Rs1.3 billion in the same period of a year back, reflecting a decline of 30 per cent, mainly on account of higher claims, increasing the claim ration in the said quarter to 72 per cent as against 60 per cent during the same period a year back. The analysis to draw up cumulative financial performance of the non life insurance companies is based on 16 out of the total 25 listed companies. These companies represent approxiametly 95 per cent of the total market capitalization of listed non-life insurance companies. Non-life insurance sector's earnings depicted a decline of 30 per cent in 1Q2008 as the sector's combined profitability stood at Rs933 million versus Rs1.3 billion in 1Q2007. Total net premium of the sector showed a healthy growth of 11 per cent to stand at Rs4.7 billion as against Rs4.3billion previously. However, this rise in premium could not translate into higher underwriting profits as they registered a decline of 81 per cent primarily due to considerable rise of 34 per cent, 11 per cent and 19 per cent in net claims, net commission and underwriting expenses. The high growth of 34 per cent or Rs869 million witnessed in net claims can be attributed to the deteriorating law and order situation that plagued the country in 1Q2008. As far as key sector ratios are concerned, claim ratio rose by 12 per cent to stand at 72 per cent in 1Q2008 versus 60 per cent in 1Q2007, while expense ratio increased by 100bps to 18 per cent. Consequently, sector's combined ratio (expense ratio + claim ratio) rose to 91 per cent versus 77 per cent in 1Q2007. Analysts said that although there is vast room for growth available in the insurance sector of Pakistan with non-life insurance penetration at just 0.4pc of GDP, listed insurance companies have become over-valued since they are trading at 2009F PE of 22.4 xs.