Saudi Re for Cooperative Reinsurance has posted a net profit before zakat of SAR42.6m ($11.4m) for 1H2019, three times the figure chalked up in the corresponding period last year.
The 204% increase was achieved through higher investment income. This was despite the fact that GWP in the first six months stood at SAR506.53m, a decline of 14.2% from the SAR590.57m seen in 1H2018. In addition, net incurred claims crept up by 1.2% to SAR208.3m in 1H2019.
Meanwhile, Saudi Re maintains its A3 Insurance Financial Strength Rating (IFSR) with a stable outlook from Moody’s Investors Service.
Moody’s said Saudi Re’s A3 rating reflects its strong market position and brand as the sole professional reinsurer in the kingdom and its growing presence in the target markets of Asia, Africa and Lloyd’s. The rating further reflects Saudi Re’s preferential status in the Saudi market due to the right of first refusal of part of premiums ceded by direct insurance companies in the local market.
Furthermore, Moody’s mentioned in a recent statement other elements of strength including Saudi Re asset quality strength, which is reflected in the reinsurer’s conservative investment portfolio, good capital adequacy, both in terms of capital levels, and relatively modest exposure to natural catastrophe risk, and, strong financial flexibility with non-existent leverage and good access to capital markets in Saudi Arabia, and broad investor base.
According to Moody’s, the stable outlook rating reflects its expectation that Saudi Re will maintain its recent improvements in profitability, while maintaining its strong assets quality, capital adequacy and adequate level of reserves.