Operating profit generated in the Saudi insurance market was SAR449 million ($120 million) in 2017, 79% lower compared to SAR2.12 billion in the previous year, according to the 2017 annual report on the insurance market issued this week by the Saudi Arabian Monetary Agency (SAMA).
The operating results led the sector to post net profits of SAR688 million last year compared to SAR2.1 billion in 2016, the report shows.
Total premiums in the kingdom dipped by 1% in 2017 to SAR36.5 billion from SAR36.8 billion in 2016.
Health insurance premiums for 2017 rose by 2.2% to SAR19 billion, compared to SAR18.6 billion in 2016. Health insurance represented 52% of total insurance premiums in the market.
Motor compulsory and non-compulsory lines of business stood in second place with a 30.5% share of total GWP. Motor premiums fell by 8.4% to SAR11.1 billion in 2017.
On the other hand, the premiums paid for general insurance (not including motor) decreased by 4.9% to SAR16.3 billion last year, compared to 2016. General insurance represents 45% of the total insurance premiums subscribed .
Protection and savings premiums grew by 8.5% to SAR1.1 billion last year, compared to 2016. This class of business represented 3.1% of the market's total premiums.
The retention rate of the insurance sector increased to 84.5% in 2017 compared to 2016's 83.7%.
The total claims paid amounted to SAR26.5 billion for 2017 compared to SAR26 billion in 2016, up by 1.9%. Claims paid for health insurance and vehicle insurance accounted for 58.3% and 31.3%, respectively, of total claims paid in 2017.
The number of employees in the insurance industry totalled 11,272 at the end of last year, with Saudis making 69% of this total. The ratio was higher than the 64% at end-2016.
In 2017, the top eight insurance companies in the kingdom generated 73% of the insurance market’s GWP. 25 other insurers competed for the remaining 26% of the market.