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WWW.BADRICONSULTANCY.COM
Badri Management Consultancy
Q1 2021 - KSA Insurance Companies
SAUDI ARABIA’S INSURANCE INDUSTRY
PERFORMANCE ANALYSIS – Q1
2021
JUNE 9, 2021
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Badri Management Consultancy
Q1 2021 - KSA Insurance Companies
Badri Management Consultancy is proud to have won the Strategic Partner ofthe Industry at the 7th Middle East Insurance Industry Awards 2020 conductedby Middle East Insurance Review.
The award is a reflection of the trust and loyalty of our esteemed clients, andthe hard work and dedication of all our people at Badri.Apart from excellence in core actuarial services, Badri has raised the bar inproviding industry insights with market specific reports, trainings, newsletters,and data analytics with an aim to benefit the insurance industry at large.
Thank you Middle East Insurance Review and the judges for acknowledging allthe efforts put in behind the scenes.
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Badri Management Consultancy
Q1 2021 - KSA Insurance Companies
Badri Management Consultancy is thefastest growing Actuarial Consulting Firmin the Middle East, recognized for itscollaborative approach to working withits clients as Profit Optimizing Partners.We are serving as Appointed Actuary forover 20 companies in the GCC. Inaddition, we are providing other servicesincluding IFRS17 Implementations,Development of ERM Framework,Specialized services for Medical Insuranceand TPAs, Business Intelligence solutionsand End of Service Benefits Valuations.
ABOUT BADRI
MANAGEMENT CONSULTANCY
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Badri Management Consultancy
Q1 2021 - KSA Insurance Companies
MISSION
We help our clients be the best version of themselves by fostering
partnerships, challenging norms and providing cutting edge solutions. We
inspire our people to constantly evolve and chase excellence with integrity in a diverse, exciting and
growth-oriented culture.
Vision
Solution architects strengthening our partners to optimize performance
Core Values
Integrity Chasing ExcellencyWe uphold the highest standards of integrity
in all of our actions by being professional, transparent and independent.
Chasing ExcellenceThrough our empowered teams, we raise the bar by challenging norms to provide cutting
edge solutions to our partners.
Fostering PartnershipsWe foster our partnerships with all our
stakeholders through collaboration, empathy and adaptability.
Breeding ExcitementWe value our people and create an exciting
environment for them to develop.
Growth-CentricWe believe in creating a vibrant culture
through continuous personal and professional growth of our people, while also
growing the business.
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Badri Management Consultancy
Q1 2021 - KSA Insurance Companies
5
Overview of the industry Page 6
SWOT Analysis Page 7
Premium Page 8 to 14
Claims, Reserves & Profitability Analysis Page 16 to 24
Investment Analysis Page 26 to 27
Key Financial Ratios Page 29 to 39
TABLE OF CONTENT
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Badri Management Consultancy
Q1 2021 - KSA Insurance Companies
GWP Growth Key External Drivers
5-year CAGR Annual Growth Penetration Quarterly GDP Growth Policy Rate
1.22% 2.30% 1.48% -3.90% 1.65%
NWP Growth
5-year CAGR Annual Growth
1.11% 1.00%
Retention Ratio
5-year Growth During 2021 Q1
0.00% 83.00%
ROA
During 2021 Q1
5-year Growth
0.55% 2.05%
ROI
During 2021 Q1
5-year Growth
1.02% 7.52%
Net Loss Ratio
During 2021 Q1
5-year Growth
-2.60% 83.3%
6
OVERVIEW OF THE INDUSTRY
76%
78%
80%
82%
84%
-
5,000
10,000
15,000
Q1 2020 Q1 2021
SAR
Mill
ion
s
INDUSTRY MIX
GWP NEP NCI Net Incurred Loss Ratio
2015 2016 2017 2018 2019 2020
2015 2016 2017 2018 2019 2020
2015 2016 2017 2018 2019 2020
2015 2016 2017 2018 2019 2020
2015 2016 2017 2018 2019 2020
-5%
20%
45%
70%
95%
120%
145%
170%
2015 2016 2017 2018 2019 2020
Loss Ratio
Health Motor Property
Engineering A&L Marine
Energy Aviation Industry Average
0%
20%
40%
60%
80%
100%
120%
2015 2016 2017 2018 2019 2020
Retention Ratio
Health Motor Property
Engineering A&L Marine
Energy Aviation Industry Average
2015 2016 2017 2018 2019 2020
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Badri Management Consultancy
Q1 2021 - KSA Insurance Companies
7
SWOT ANALYSIS
Strength:
• A proactive insurance regulator issuing supportive
policies
• A number of multinational players present in the
market providing diversification and showcasing
market potential.
• Focusing on digitalization innovation and insurtech.
• Najm system for motor, has been a value added to
the insurance sector of KSA.
• Ratemaking exercise is conducted for the insurance
companies however for some other Middle East
countries it is still on non-actuarial basis
• Insurance regulatory has been promoting new
regulation by making it mandatory to insured the
belonging i.e., Motor vehicle, premises etc. Also,
the growing GDP of the country is a plus for the
Insurance industry
Developmental Areas:
• Highly competitive market especially for retail
motor and medical lines driving down prices. Need
to move away from traditional burning cost pricing
to more sophisticated GLM or Machine Learning
methodologies.
• Nphies system for medical will soon start its
operation.
• Lack of awareness of insurance apart from the
compulsory insurance and B2B insurance
• More emphasis on the TPA structure.
• Essential Industry information's should be
published on quarterly basis.
• Market has high expense ratios compared to other
regional countries and efficiencies can come in
through improvements in processes.
Opportunities:
• A large untapped and uninsured motor insurance
population
• Mergers and acquisitions are consolidating the
weaker companies and creating a lesser number of
financially stable players.
• Lack of life business penetration, can pick pace if
the right kind of products are sold through the
right channels,
Threats:
• Falling oil prices would result in lower economic
activity and growth. Thus, slowing down the
business performances throughout the industries.
• High unemployment rates among young Saudis
• Growing inflation rate.
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Badri Management Consultancy
Q1 2021 - KSA Insurance Companies
8
Listed Insurance Companies Recorded Gross written Premiums of
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Badri Management Consultancy
Q1 2021 - KSA Insurance Companies
GROSS WRITTEN PREMIUMS
For the 29 listed companies, the GWP grewfrom SAR 12.6 billion in Q1-2020 to SAR 12.8billion in Q1-2021 highlighting a growth of1.8%. Without Saudi Re, the GWP of theindustry has increased from SAR 12.2 billionin Q1-2020 to SAR 12.4 billion in Q1-2021signifying a growth of 1.6%.
9
-
2,000
4,000
6,000
8,000
10,000
12,000
14,000
Q1 2020 Q1 2021
SAR
Mill
ion
s
Gross Written Premium
Gross Written Premium
Bupa 1 1
Tawuniya 2 2
Medgulf 3 9
Saudi Re 4 5
Al-Rajhi 5 3
AXA 6 4
SAICO 7 21
Walaa 8 26
Wataniya 9 22
Malath 10 18
Arabian Shield 11 6
Allianz 12 11
Al Etihad 13 7
Gulf Union ALAhlia 14 29
Arabia 15 16
ACIG 16 12
GGI 17 25
Salama 18 13
UCA 19 27
CHUBB 20 15
Alahli 21 10
Alinma 22 19
Amana 23 24
Al Sagr 24 28
SABB 25 17
Al Alamiya 26 14
AlJazira 27 8
Enaya 28 23
Buruj 29 20
CompanyRanking
IndicationGWP Profit
0.00%
0.20%
0.40%
0.60%
0.80%
1.00%
1.20%
1.40%
1.60%
1.80%
0
5
10
15
20
25
30
35
40
452
01
1
20
12
20
13
20
14
20
15
20
16
20
17
20
18
20
19
20
20
SAR
Bill
ion
s
Fiscal Years
GWP & Penetration
Gross Written Premium Insurance Penetration
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Badri Management Consultancy
Q1 2021 - KSA Insurance Companies
GROSS WRITTEN PREMIUMS
The top 5 companies have a combinedpremium of SAR 8.78 billion in Q1-2021 ascompared to SAR 8.62 billion in Q1-2020.
The highest GWP growth in Q1-2021 has beenshown by Saudi Re with an increase of 58% inpremiums compared to the correspondingperiod of 2020 whereas Arabia has scoredsecond largest growth of 45% in Q1-2021compare to Q1-2020. The largest decline overthe same period has shown by UCA with adecrease of 52% compared to thecorresponding period of Q1-2020
10
0%
7% 3%2% 14%
0%11%
21% 32% 45% 14% 0% 38% -52% -5% 42% -20% -25% -29% 16% -3% 13% -26% -47%
-
100
200
300
400
500
600
AX
A
SAIC
O
Wal
aa
Wat
aniy
a
Mal
ath
Ara
bia
n S
hie
ld
Alli
anz
Al E
tih
ad
Gu
lf U
nio
n…
Ara
bia
AC
IG
GG
I
Sala
ma
UC
A
CH
UB
B
Ala
hli
Alin
ma
Am
ana
Al S
agr
SAB
B
Al A
lam
iya
AlJ
azir
a
Enay
a
Bu
ruj
SAR
Mill
ion
s
OTHERS
Q1 2020 Q1 2021
-6%13%
-18%58% -6%
-
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
Bupa Tawuniya Medgulf Saudi Re Al-Rajhi
SAR
Mill
ion
s
TOP FIVE
Q1 2020 Q1 2021
Q1 202169%
Q1 202131%
Q1 202069%
Q1 202031%
GWP DISTRIBUTION
Top Five
Others
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Badri Management Consultancy
Q1 2021 - KSA Insurance Companies
GROSS WRITTEN PREMIUMS
11
Bupa
Tawuniya
Medgulf
Saudi Re
Al-Rajhi
AXA
SAICO
Walaa
Wataniya
Malath
Arabian Shield
Allianz
Al Etihad
Gulf Union ALAhlia
Arabia
ACIG
GGI
Salama
UCA
CHUBB
Alahli
Alinma
Amana
Al Sagr
SABB
Al Alamiya
AlJazira
Enaya
Buruj
0
5
10
15
20
25
30
0
5
10
15
20
25
30
0 5 10 15 20 25 30
RANKING
Profit - Ranking GWP - Ranking
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Badri Management Consultancy
Q1 2021 - KSA Insurance Companies
12
It can be inferred that Growth in NEP and NWP have followed same pattern however there hasbeen some exception may be due to some other factors.
Growth in NEP and Change in retention ratio from the period Q1-2020 to Q1-2021 havefollowed same pattern i.e., increase in growth of Net Earned Premium is followed by increase inthe retention ratio for the period.
EARNED PREMIUM
-100%
-50%
0%
50%
100%
150%
200%
250%
Taw
un
iya
Mal
ath
Med
gulf
Alli
anz
Sala
ma
Wal
aa
Ara
bia
n S
hie
ld
SAB
B
SAIC
O
Gu
lf U
nio
n A
LAh
lia
Ala
hli
AC
IG
Ara
bia
Al E
tih
ad
Al S
agr
UC
A
Sau
di R
e
Bu
pa
Al-
Raj
hi
CH
UB
B
AX
A
GG
I
Bu
ruj
Al A
lam
iya
Wat
aniy
a
Am
ana
Enay
a
Alin
ma
Growth in NEP & NWP
Growth in NEP Growth in NWP
-100%
-50%
0%
50%
100%
150%
200%
250%
Taw
un
iya
AlJ
azir
a
Mal
ath
Med
gulf
Alli
anz
Sala
ma
Wal
aa
Ara
bia
n S
hie
ld
SAB
B
SAIC
O
Gu
lf U
nio
n A
LAh
lia
Ala
hli
AC
IG
Ara
bia
Al E
tih
ad
Al S
agr
UC
A
Sau
di R
e
Bu
pa
Al-
Raj
hi
CH
UB
B
AX
A
GG
I
Bu
ruj
Al A
lam
iya
Wat
aniy
a
Am
ana
Enay
a
Alin
ma
Growth in NEP vs Change in Retention ratio
Growth in NEP Change in Retention Ratio
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Badri Management Consultancy
Q1 2021 - KSA Insurance Companies
RETENTION RATIO
13
The highest retention ratio for Q1-2021 of 100% is reflected by Enaya, whereas the lowestretention ratio of 39% is reflected by Al Alamiya.
The weighted average retention ratio for listed companies stood at 86% for Q1-2021 (YE2020: 82%).
The retention ratio has been calculated as a ratio of net written premium to gross writtenpremium. Although there may be exceptions, retention ratios are generally reflective of thelines of business being underwritten; Motor and Medical generally tend to have highretention ratios, while commercial lines such as Aviation, Engineering and Fire tend to havelower retentions. Also, since this analysis does not segregate life and non-life business, theCompanies writing higher volumes of life, especially IL and PA, would also tend to showhigher retention levels.
0%
20%
40%
60%
80%
100%
120%
Enay
a
Bu
pa
Sau
di R
e
Sala
ma
AlJ
azir
a
AX
A
Al S
agr
Mal
ath
Taw
un
iya
Al E
tih
ad
Al-
Raj
hi
AC
IG
Bu
ruj
Am
ana
GG
I
Med
gulf
Gu
lf U
nio
n A
LAh
lia
Wal
aa
Ara
bia
SAB
B
SAIC
O
Ala
hli
Ara
bia
n S
hie
ld
Alin
ma
Wat
aniy
a
CH
UB
B
Alli
anz
UC
A
Al A
lam
iya
RETENTION RATIO
Retention Ratios Weighted Average
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Badri Management Consultancy
Q1 2021 - KSA Insurance Companies
RETENTION RATIO
14
Overall, the insurance sector has witnessed growth in retention ratio since 2016 till 2018which has mainly driven by increase in proportion of health and motor insurance business.From 2019 the retention ratio has decreased followed by major decrease in the retentionratio of general insurance.
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Overall
Motor Insurrance
Health Insurrance
General Insurrance
Yearly Retention Ratio by LOBs
2015 2016 2017 2018 2019 2020
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Badri Management Consultancy
Q1 2021 - KSA Insurance Companies
15
Listed Insurance Companies Recorded Profits at
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Badri Management Consultancy
Q1 2021 - KSA Insurance Companies
16
Total net reserves as at Q1-2021 are SAR 31.5 billion.
Total Net Reserve of top five companies by Net Reserves as at Q1-2021 is SAR 20.2 billion.
NET TECHNICAL RESERVES
Top Five64%
Others36%
NET RESERVES
-
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
Bupa Tawuniya Al-Rajhi Saudi Re MedgulfSA
R M
illio
ns
TOP FIVE
Net Reserves Q1 2020 Net Reserves Q1 2021
-
200
400
600
800
1,000
1,200
1,400
1,600
1,800
AX
A
AlJ
azir
a
Alli
anz
Wal
aa
Al E
tih
ad
Gu
lf U
nio
n A
LAh
lia
Mal
ath
Wat
aniy
a
SAIC
O
SAB
B
Ara
bia
n S
hie
ld
AC
IG
Sala
ma
Al S
agr
Ara
bia
Am
ana
UC
A
Bu
ruj
GG
I
Alin
ma
Enay
a
CH
UB
B
Al A
lam
iya
Ala
hli
SAR
Mill
ion
s
OTHERS
Net Reserves Q1 2020 Net Reserves Q1 2021
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Badri Management Consultancy
Q1 2021 - KSA Insurance Companies
17
The graph above shows the proportion of each company’s Net Reserves to its Net WrittenPremium.
NET TECHNICAL RESERVES
0% 100% 200% 300% 400% 500% 600% 700%
AlJazira
SABB
Allianz
Buruj
Al Sagr
UCA
Gulf Union
Alinma
Al Alamiya
Al Etihad
Al-Rajhi
Amana
Enaya
AXA
Salama
Walaa
ACIG
Wataniya
Saudi Re
Arabian Shield
Tawuniya
Medgulf
Arabia
Malath
Bupa
CHUBB
SAICO
GGI
Alahli
% of Net Reserves to Net Written Premium over the years
Q1 2020 Q1 2021
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Badri Management Consultancy
Q1 2021 - KSA Insurance Companies
18
The Growth of Net Claims Incurred has followed an uneven pattern. Major decline in theclaims has been witnessed from 2020 Q1 to 2020 Q2, which is primarily due to the outbreakof COVID-19.
Net claims Incurred has increased by 12% from 2020 Q3 to 2020 Q4. However, there is adecrease of 6% in the Net Claims incurred in Q1-2021. The reason for a decrease might bebecause things had started to open post covid, medical deferred claims kicked in Q4-2020but then got normalized and hence reduction in Q1 -2021. As for Motor, the claims has beenreported as things started to get into its usual pace after the lockdown has been removed.
NET CLAIMS INCURRED & GROWTH
-30%
-20%
-10%
0%
10%
20%
30%
-
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
20
19
-Q1
20
19
-Q2
20
19
-Q3
20
19
-Q4
20
20
-Q1
20
20
-Q2
20
20
-Q3
20
20
-Q4
20
21
-Q1
Gro
wth
%
SAR
Mill
ion
s
Fiscal Years
Net Claims Incurred & Growth
Net Claims Incurred Growth
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Badri Management Consultancy
Q1 2021 - KSA Insurance Companies
COMBINED RATIO
19
The weighted average combined ratio for Q1-2021 is 102% (YE 2020: 98%).
Highest combined ratio of 163% was shown by Al Sagr while the lowest 87% combinedratio was reflected by Al Jazira.
131%116% 111% 104% 114%
32%46% 50% 53% 27%
0%
20%
40%
60%
80%
100%
120%
140%
160%
180%
Al Sagr UCA Enaya GGI Gulf Union ALAhlia
TOP FIVE - COMBINED RATIO
Loss Ratio Expense Ratio
101%77% 75%
36%
91% 92%75% 80% 78% 71% 69% 77% 74%
86% 83% 73% 76%
43%
86%62% 70% 69% 76%
64%
35%57% 54%
89%
33% 30%43% 35% 29% 33% 35% 26% 27%
15% 16%26% 21%
54%
11%34% 23% 20% 13%
23%
0%
20%
40%
60%
80%
100%
120%
140%
160%
Am
ana
Bu
ruj
Alin
ma
Al A
lam
iya
Alli
anz
Wal
aa
Wat
aniy
a
SAIC
O
Mal
ath
SAB
B
Sala
ma
Ala
hli
Ara
bia
Taw
un
iya
Med
gulf
AC
IG
Al E
tih
ad
CH
UB
B
Bu
pa
Sau
di R
e
AX
A
Al-
Raj
hi
Ara
bia
n S
hie
ld
AlJ
azir
a
OTHERS
Loss Ratio Expense Ratio Industry Combined Ratio
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Badri Management Consultancy
Q1 2021 - KSA Insurance Companies
LOSS RATIO
20
During Q1-2021, weighted average loss ratio remained at 83% (YE 2020: 77%).
Loss Ratio has been calculated by dividing Net Incurred Claims and Change in Other reservesto the net earned premiums.
Highest Loss ratio of 131% is shown by Al Sagr whereas the lowest of 36% is shown by AlAlamiya.
0%
20%
40%
60%
80%
100%
120%
Am
ana
Wal
aa
Alli
anz
Taw
un
iya
Bu
pa
Med
gulf
SAIC
O
Mal
ath
Bu
ruj
Ala
hli
Al E
tih
ad
Ara
bia
n S
hie
ld
Wat
aniy
a
Alin
ma
Ara
bia
AC
IG
SAB
B
AX
A
Sala
ma
Al-
Raj
hi
AlJ
azir
a
Sau
di R
e
CH
UB
B
Al A
lam
iya
OTHERS - LOSS RATIO
Loss Ratio Industry Loss Ratio
0%
20%
40%
60%
80%
100%
120%
140%
Al Sagr UCA Gulf Union ALAhlia Enaya GGI
TOP FIVE - LOSS RATIO
Loss Ratio
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Badri Management Consultancy
Q1 2021 - KSA Insurance Companies
21
During Q1-2021, weighted average Expense ratio remained at 19% (YE 2020: 21%).
Expense Ratio has been calculated by dividing the sum of G&A Expenses, net Commissionexpenses and other operational expense to Net Earned Premium.
Highest Expense ratio of 89% is shown by Al Alamiya whereas the lowest is of 11% is shownby Bupa.
EXPENSE RATIO
0%
10%
20%
30%
40%
50%
60%
Enay
a
UC
A
Wat
aniy
a
SAIC
O
Am
ana
Sala
ma
Sau
di R
e
Alli
anz
SAB
B
Al S
agr
Wal
aa
Mal
ath
Ara
bia
Gu
lf U
nio
n…
Ala
hli
AC
IG
AlJ
azir
a
AX
A
Al E
tih
ad
Al-
Raj
hi
Med
gulf
Taw
un
iya
Ara
bia
n S
hie
ld
Bu
pa
OTHERS - EXPENSE RATIO
Expense Ratio Industry Expense Ratio
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Al Alamiya Buruj Alinma CHUBB GGI
TOP FIVE - EXPENSE RATIO
Expense Ratio
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Badri Management Consultancy
Q1 2021 - KSA Insurance Companies
G&A EXPENSE
22
Weighted average G&A Expense ratio for the industry is 15% for Q1-2021 (YE 2020: 16.5%).
Among all, Al Alamiya has the highest expense ratio of 102% whereas the lowest expenseratio of 9% is reflected by Bupa and Saudi Re.
0%
10%
20%
30%
40%
50%
60%
GG
I
Enay
a
Wat
aniy
a
Sala
ma
Alli
anz
Al S
agr
SAIC
O
SAB
B
Am
ana
Ara
bia
Ala
hli
Mal
ath
Gu
lf U
nio
n A
LAh
lia
Ara
bia
n S
hie
ld
AlJ
azir
a
AC
IG
Wal
aa
Med
gulf
Al E
tih
ad
AX
A
Al-
Raj
hi
Taw
un
iya
Sau
di R
e
Bu
pa
OTHERS
G&A Expense Ratio Weighted Average G&A Expense Ratio
0%
20%
40%
60%
80%
100%
120%
Al Alamiya CHUBB UCA Buruj Alinma
TOP FIVE
G&A Expense Ratio
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Badri Management Consultancy
Q1 2021 - KSA Insurance Companies
COMMISSION EXPENSE
23
Saudi Re showed the highest commission expense ratio for Q1-2021 of 24%, whereas the lowestexpense ratio of -13% is reflected by Al Alamiya.
Industry Weighted Average expense ratio is at 4% (YE 2020: 5%).
Since Saudi Re has a different nature of business, the second highest commission expense ratioof 12% is achieved by Walaa.
0%
5%
10%
15%
20%
25%
30%
Saudi Re Walaa Amana AXA SAICO
TOP FIVE
Commission Expense Ratio
-15%
-10%
-5%
0%
5%
10%
AC
IG
SAB
B
Mal
ath
Al-
Raj
hi
Gu
lf U
nio
n A
LAh
lia
Al E
tih
ad
Enay
a
Al S
agr
Sala
ma
Alli
anz
Taw
un
iya
GG
I
AlJ
azir
a
Wat
aniy
a
Bu
pa
Ala
hli
Ara
bia
Bu
ruj
Alin
ma
Med
gulf
CH
UB
B
Ara
bia
n S
hie
ld
UC
A
Al A
lam
iya
OTHERS
Commission Expense Ratio Weighted Average Commissions Expense Ratio
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The term Profit indicates the TotalProfit/Loss attributed toShareholders before Zakat andTax deductions.
Bupa booked the highest profitduring Q1-2021 of SAR 175.42million as compared to a profit ofSAR 125.66 million for thecorresponding period of Q1-2020
Gulf Union Al Ahlia booked thehighest loss of SAR 56.80 millionin Q1-2021 as compared to a lossof SAR 6.10 million in thecorresponding period of Q1-2020.
Net profit generated by 29Companies in the industry for Q1-2021 amounted to SAR 211.56million compared to a profit ofSAR 166.95 million for thecorresponding period of Q1-2020,which is an increase of around27%.
PROFIT COMPOSITION
-
50
100
150
200
Bupa Tawuniya Al-Rajhi AXA Saudi Re
SAR
Mill
ion
s
TOP FIVE
Profit for Q1 2020 Profit for Q1 2021
(70)
(60)
(50)
(40)
(30)
(20)
(10)
-
GGI Walaa UCA Al Sagr Gulf UnionALAhlia
SAR
Mill
ion
s
BOTTOM FIVE
Profit for Q1 2020 Profit for Q1 2021
(30) (25) (20) (15) (10)
(5) - 5
10 15 20
Ara
bia
n S
hie
ld
Al E
tih
ad
AlJ
azir
a
Med
gulf
Ala
hli
Alli
anz
AC
IG
Sala
ma
Al A
lam
iya
CH
UB
B
Ara
bia
SAB
B
Mal
ath
Alin
ma
Bu
ruj
SAIC
O
Wat
aniy
a
Enay
a
Am
ana
SAR
Mill
ion
s
OTHERS
Profit for Q1 2020 Profit for Q1 2021
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Listed Insurance Companies Total Assets stood at
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26
Around half the companies have total shareholder’s equity of more than SAR 400 Million, with10 being over SAR 500 million
ASSETS & SHAREHOLDER EQUITY ANALYSIS
Cash25%
Deferred2%
Investment33%
Fixed Assets1%
Receivables &
Prepayments13%
Reinsurrance24%
Intangible2%
ASSETS CLASSIFICATION
5 Companies are in the range of SAR 0
M to SAR 200 M
7 Companies are in the
range of SAR 200 M to SAR
300 M3 Companies
are in the range of SAR 300 M to SAR
400 M
4 Companies are in the
range of SAR 400 M to SAR
500 M
10 Companies are in the
range of SAR 500 M and
above
EQUITY SIZE & COMPANIES
- 10 20 30 40 50 60
Total Policyholders’ assets
Shareholders’ assets
Total assets
Policyholders’ liabilities and equity
Shareholders’ liabilities and equity
Total Liabilities & Equity
SAR Billions
Financial Instruments
2015 2016 2017 2018 2019 2020
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Bupa and Tawuniya are the top 2 companies with Largest NWP and shareholder’s Equity;whereas, Saudi Re is the 3rd largest company by NWP but has secured 4th rank in the list ofhighest Shareholder’s Equity.
FINANCIAL INSTRUMENTS
Tawuniya
Saudi Re
Bupa
0
700
1,400
2,100
2,800
3,500
- 250 500 750 1,000 1,250 1,500 1,750 2,000 2,250 2,500 2,750 3,000 3,250 3,500 3,750 4,000
NW
P (
SAR
Mill
ion
s)
Shareholder's Equity (SAR Millions)
Insurance Companies' Equity vs NWP
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Listed Insurance Companies Capital Adequacy Ratio stood at
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ROE & ROA TREND
29
Return on Equity is the ratio of Net Profit for the period to Total Equity at start of the periodwhereas Return on Assets is ratio of Net Profit for the period to Total Assets (as at).
ROA and ROE has been following the same pattern however, ROE has shown more volatility tothe changes.
-6.00%
-4.00%
-2.00%
0.00%
2.00%
4.00%
6.00%
8.00%
10.00%
12.00%
14.00%
16.00%
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
ROA ROE
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NWP TO EQUITY RATIO
30
The highest Premium to Equity ratio for Q1-2021 is 1.03, shown by Medgulf, whereas thelowest ratio of 0.05 is reflected Al Alamiya.
Weighted average Premium to Equity ratio of Q1-2021 is 0.58 (YE 2020: 1.72).
The Premium to Equity ratio is calculated by taking the proportion of Net Written premium ofQ1-2021 to Total Equity as at Q1-2021. It represents the premium that pertains to each SARamount of equity held by the Companies.
-
0.20
0.40
0.60
0.80
1.00
1.20
Med
gulf
Am
ana
Taw
un
iya
AC
IG
Sau
di R
e
Bu
pa
GG
I
Wat
aniy
a
SAIC
O
Gu
lf U
nio
n A
LAh
lia
Mal
ath
Ara
bia
AX
A
Al-
Raj
hi
Sala
ma
Enay
a
Ara
bia
n S
hie
ld
Al E
tih
ad
Wal
aa
Al S
agr
Alin
ma
Ala
hli
UC
A
Alli
anz
CH
UB
B
SAB
B
Bu
ruj
AlJ
azir
a
Al A
lam
iya
Premium to Equity Ratio
Premium-Equity ratio Weighted Average
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The highest Liquidity Ratio for Q1-2021 is 360% shown by Al Alamiya, whereas the lowestliquidity ratio of 25% is reflected by Al Ahli.
Weighted average Liquidity ratio for the period of Q1-2021 stood at 88% (YE 2020: 101%).
The liquidity ratio has been calculated as a ratio of current assets over total net technicalreserves as at March 31, 2021.
The optimum value of the Absolute Liquidity Ratio for a company is 50%. This optimum ratioindicates the sufficiency of the 50% worth absolute liquid assets of a company to pay the 100%of its worth obligations in time
LIQUIDITY RATIO
0%
50%
100%
150%
200%
250%
300%
350%
400%
Al A
lam
iya
CH
UB
B
Alin
ma
Ara
bia
n S
hie
ld
Wal
aa
Enay
a
Am
ana
AC
IG
GG
I
UC
A
Ara
bia
Mal
ath
Al S
agr
Wat
aniy
a
Sala
ma
SAIC
O
Alli
anz
Bu
ruj
Al E
tih
ad
Sau
di R
e
Me
dgu
lf
Gu
lf U
nio
n A
LAh
lia
Taw
un
iya
AX
A
SAB
B
Al-
Raj
hi
Bu
pa
AlJ
azir
a
Ala
hli
LIQUIDITY
Liquidity Ratio Weighted Average Liquidity Ratio
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The highest Equity ratio for Q1-2021 is 0.53 shown by Buruj, whereas the lowest ratio of 0.14 isreflected Wataniya.
Weighted average Equity ratio for Q1-2021 is 0.27 (YE 2020: 0.28).
The Equity ratio is a financial ratio indicating the relative proportion of equity used to finance acompany's assets. It is calculated as Total equity as at March 31, 2021, divided by Total Assets asat March 31, 2021.
EQUITY RATIO
-
0.10
0.20
0.30
0.40
0.50
0.60
Bu
ruj
Al A
lam
iya
CH
UB
B
Al E
tih
ad
Ara
bia
n S
hie
ld
Al S
agr
Bu
pa
Mal
ath
Wal
aa
Enay
a
AX
A
GG
I
Alin
ma
AlJ
azir
a
Ara
bia
SAB
B
Sala
ma
Sau
di R
e
Al-
Raj
hi
Alli
anz
UC
A
AC
IG
Ala
hli
SAIC
O
Taw
un
iya
Gu
lf U
nio
n A
LAh
lia
Med
gulf
Am
ana
Wat
aniy
a
Equity Ratio
Equiy ratio Weighted Average
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The highest Net leverage ratio for Q1-2021 is 6.31 shown by Wataniya, whereas the lowest of0.87 is reflected by Buruj.
For Q1-2021, the weighted average leverage ratio for the market is at 2.71 (YE 2020: 2.56).
The Leverage ratio is calculated by taking the proportion of Total Liabilities at March 31, 2021,to Net worth of the Company at March 31, 2021.
Internationally, the desired range typically falls below 5.0 for property insurers and 7.0 forliability insurers.
NET OPERATING LEVERAGE
-
1.00
2.00
3.00
4.00
5.00
6.00
7.00
Wat
aniy
a
Am
ana
Med
gulf
Gu
lf U
nio
n A
LAh
lia
Taw
un
iya
SAIC
O
Ala
hli
AC
IG
UC
A
Alli
anz
Al-
Raj
hi
Sau
di R
e
Sala
ma
SAB
B
Ara
bia
AlJ
azir
a
Alin
ma
GG
I
AX
A
Enay
a
Wal
aa
Mal
ath
Bu
pa
Al S
agr
Ara
bia
n S
hie
ld
Al E
tih
ad
CH
UB
B
Al A
lam
iya
Bu
ruj
Operating Leverage
Operating Leverage Weighted Average
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Capital Intensity Ratio shows how much business does a SAR generate. That is, the premiumwritten per SAR invested in the company. A high CIR shows that per SAR invested the companycan maximize Gross Written Premium.
It is calculated by taking a proportion of Gross Written Premium of Q1-2021 to Total Assets as atMarch 31, 2021
The Industry weighted Average Capital Intensity ratio for Q1-2021 is 18% (YE 2020: 58%).
GGI attains highest CIR of 28% whereas, lowest of 4% CIR is attained by Buruj.
CAPITAL INTENSITY RATIO
0%
5%
10%
15%
20%
25%
30%
GG
I
Bu
pa
AC
IG
Sau
di R
e
Ara
bia
SAIC
O
Med
gulf
Mal
ath
Taw
un
iya
Ara
bia
n S
hie
ld
Ind
ust
ry A
vera
ge
AX
A
Am
ana
Wat
aniy
a
Al-
Raj
hi
Sala
ma
Gu
lf U
nio
n A
LAh
lia
Enay
a
Wal
aa
Al E
tih
ad
CH
UB
B
Alin
ma
UC
A
Al S
agr
Alli
anz
Ala
hli
Al A
lam
iya
SAB
B
Bu
ruj
Cap
ital
Inte
nsi
ty R
atio
(%
)
Capital Intensity Ratio
Capital Intensity Ratio Q1 2021 Indutry Average
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Asset Mix compares the proportion of invested assets and non-invested assets as at Q1-2021.Total Invested Assets are the sum of Property, Cash and Other Invested Assets.
Al Ahli has the highest proportion of 88% of its assets invested, while Wataniya has the lowestof 29% assets invested.
INVESTED / NON-INVESTED ASSETS TO TOTAL ASSETS
0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0%
27%
8%
56%
16%10%
44%
33%38%
21%27%
46%
5%
47%
27%
57% 55%
8% 9%
24%16%
36% 34%39%
50%
59%
20%
40%
54%
40%
21%
74%
9%
16%
38%
31%
23%21%
59%
8%
24%
82%8%
19%
15% 20%
24%24%
54%
57%13%
40%
9%
32% 17%
10%
14%
22%
18%
52%
18%
35%
68%
52%
26%
44% 41%
19%
65%
30%
12%
45%54%
28% 25%
69% 66%
23%28%
51%
26%
52%
18%24%
71%
46%
24%
43%
26%
33%
41%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Taw
un
iya
AlJ
azir
a
Mal
ath
Med
gulf
Alli
anz
Sala
ma
Wal
aa
Ara
bia
n S
hie
ld
SAB
B
SAIC
O
Gu
lf U
nio
n A
LAh
lia
Ala
hli
AC
IG
Ara
bia
Al E
tih
ad
Al S
agr
UC
A
Sau
di R
e
Bu
pa
Al-
Raj
hi
CH
UB
B
AX
A
GG
I
Bu
ruj
Al A
lam
iya
Wat
aniy
a
Am
ana
Enay
a
Alin
ma
Total Assets Mix
Property Cash Other Invested Assets
Non-Invested Assets Weighted Average of Property Weighted Average of Cash
Weighted Average of Other Invested Weighted Average of Non-Invested
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Since Total Invested Assets are the sum of Property, Cash and Other Invested Assets.
The weighted average of Property to Invested Assets is 0.15%. For Cash to Invested Assets theweighted average is 44% and 56% for Other Invested to Invested Assets.
TOTAL INVESTED ASSETS MIX
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Taw
un
iya
AlJ
azir
a
Mal
ath
Med
gulf
Alli
anz
Sala
ma
Wal
aa
Ara
bia
n S
hie
ld
SAB
B
SAIC
O
Gu
lf U
nio
n A
LAh
lia
Ala
hli
AC
IG
Ara
bia
Al E
tih
ad
Al S
agr
UC
A
Sau
di R
e
Bu
pa
Al-
Raj
hi
CH
UB
B
AX
A
GG
I
Bu
ruj
Al A
lam
iya
Wat
aniy
a
Am
ana
Enay
a
Alin
ma
Total Invested Asstes Classification
Property of Invested Assets Cash of Invested Assets Other Invested
Weighted Average of Property Weighted Average of Cash Weighted Average of Other Invested
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RETURN ON INVESTMENT VS CASH RATIO
37
The Graph demonstrates the relationship between the amount of cash held by the companiesvs the return on investment.
Normally, an inverse relationship is witnessed backed by the rationale that more cash in hand Iplies fewer risky investments thus lower expected yield. However, the economic downturn isreflected in the above graph that has showed a reversed relationship.
Return on Investment is calculated by taking the ratio of Investment income for the period ofQ1-2021 to the average of Invested Assets as at Q1-2020 and Q1-2021.
Tawuniya
AlJazira
Malath
Medgulf
Allianz
Salama Walaa
Arabian Shield
SABB
SAICO
Gulf Union ALAhlia
Alahli
ACIG
Arabia
Al Etihad
Al Sagr
UCA
Saudi ReBupa
Al-Rajhi
CHUBB
AXA
Buruj
Al Alamiya
Wataniya
Amana
Enaya
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
55%
60%
65%
70%
75%
80%
85%
90%
95%
100%
0.0% 0.5% 1.0% 1.5% 2.0%
Cas
h t
o In
vest
ed A
sset
s R
atio
Return on Investment
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CAPITAL ADEQUACY RATIO
38
The Capital Adequacy Ratio (CAR) indicates how much a company is capable to absorb anyunexpected risks, hence depicting a company's financial position to meet policyholders’liabilities. Therefore, a higher ratio indicates that the companies' liabilities are on the higherside.
Capital Adequacy ratio has been calculated by taking the proportion of Total Liabilities as atMarch 31, 2021, to Total Assets as at March 31, 2021.
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Wat
aniy
a
Am
ana
Med
gulf
Gu
lf U
nio
n A
LAh
lia
Taw
un
iya
SAIC
O
Ala
hli
AC
IG
UC
A
Alli
anz
Al-
Raj
hi
Sau
di R
e
Sala
ma
SAB
B
Ara
bia
AlJ
azir
a
Alin
ma
GG
I
AX
A
Enay
a
Wal
aa
Mal
ath
Bu
pa
Al S
agr
Ara
bia
n S
hie
ld
Al E
tih
ad
CH
UB
B
Al A
lam
iya
Bu
ruj
Capital Adequacy ratio
CAR Q1 2021 Weighted Average Q1 2021
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The Tree map shows the Market size of each Company on the basis of its Total Equity as atMarch 31, 2021.
MARKET SIZE
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S. No. Symbol Name Abbreviation1 8010 The Company for Cooperative Insurance TCCI
2 8012 Aljazira Takaful Taawuni Co. AJTTC
3 8020 Malath Cooperative Insurance Co. MCIC
4 8030 The Mediterranean and Gulf Insurance and Reinsurance Co. TMGIRC
5 8040 Allianz Saudi Fransi Cooperative Insurance Co. ASFCIC
6 8050 Salama Cooperative Insurance Co. SCIC
7 8060 Walaa Cooperative Insurance Co. WCIC
8 8070 Arabian Shield Cooperative Insurance Co. ARSCIC
9 8080 SABB Takaful Co. STC
10 8100 Saudi Arabian Cooperative Insurance Co. SACIC
11 8120 Gulf Union ALAhlia Cooperative Insurance Co. GUACIC
12 8130 Alahli Takaful Co. AATC
13 8150 Allied Cooperative Insurance Group ACIG
14 8160 Arabia Insurance Cooperative Co. AICC
15 8170 Trade Union Cooperative Insurance Co. TUCIC
16 8180 Al Sagr Cooperative Insurance Co. ASCIC
17 8190 United Cooperative Assurance Co. UCAC
18 8200 Saudi Re for Cooperative Reinsurance Co. SRCRC
19 8210 Bupa Arabia for Cooperative Insurance Co. BACIC
20 8230 Al-Rajhi Company for Cooperative Insurance ARCCI
21 8240 CHUBB Arabia Cooperative Insurance Co. CACIC
22 8250 AXA Cooperative Insurance Co. AXACIC
23 8260 Gulf General Cooperative Insurance Co. GGCIC
24 8270 Buruj Cooperative Insurance Co. BCIC
25 8280 Al Alamiya for Cooperative Insurance Co. AACIC
26 8300 Wataniya Insurance Co. WIC
27 8310 Amana Cooperative Insurance Co. ACIC
28 8311 Saudi Enaya Cooperative Insurance Co. SECIC
29 8312 Alinma Tokio Marine Co. ATMC
40
Analysis of the Key Performance Indicators (KPIs) of 29* Listed Insurance Companies of KSAfor Q1 2021 has been undertaken.
`*The financial statement for Q1 2021 of Saudi Indian Insurance has not been published at the date of the publication ofthis report and hence all the analysis does not include Saudi Indian Insurance
COMPANIES INCLUDED IN ANALYSIS
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• Analysis of the Key Performance Indicators (KPIs) of 29 Listed Insurance Companiesof KSA for Q1-2021 has been undertaken. The data has been extracted from thefinancial statements of Q1-2021 of all companies as available on Tadawul.
• In certain cases, we needed to combine certain items for comparison purposes.
• The Report contains previous years values in few places that are taken from theIndustry Reports of previous years published by SAMA.
• While reasonable care has been taken in preparing this document and data obtainedfrom sources believed to be reliable, no responsibility or liability is accepted forerrors of fact or for any opinion expressed herein. Badri accepts no liability and willnot be liable for any loss or damage arising directly or indirectly (including special,incidental or consequential loss or damage) from your use of this document,howsoever arising, and including any loss, damage or expense arising from, but notlimited to, any defect, error, imperfection, fault, mistake or inaccuracy with thisdocument, its contents or associated services, or due to any unavailability of thedocument or any thereof or due to any contents or associated services.
• BADRI publishes reports and newsletters that provide insights for the insuranceindustry and the public. Our goal is to draw upon research and experience from ourprofessionals to bring transparency and availability of information to the industryand in the process spread brand awareness. No part of our compensation receivedfor other services directly or indirectly influences the contents of this report. TheAnalysts preparing the report are subject to internal rules on sound ethical conduct.
• This publication contains general information only and we are not by means of thispublication, rendering actuarial, investment, accounting, business, financial, legal,tax, or other professional advice or services. This publication is not a substitute forsuch professional advice or services, nor should it be used as a basis for any decisionor action that may affect your finances or your business. Before making any decisionor taking any action that may affect your finances or your business, you shouldconsult a qualified professional adviser. Should you come across an error or have aquery, do write to us
41
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