News Middle East21 Apr 2021

Saudi Arabia:29 listed insurers post 42% jump in aggregate net profit in 2020

| 21 Apr 2021

The aggregate net profit generated by 29 insurance companies in Saudi Arabia jumped by 42% to SAR1,972m ($526m) in 2020 compared to profit of SAR1,393m in 2019, according to an analysis by Badri Management Consultancy, a regional boutique actuarial consulting firm.

The term “profit” indicates the total profit/loss attributed to shareholders before zakat and tax. The data were extracted from the annual financial statements of insurers listed on the Saudi bourse, Tadawul.

Bupa Arabia booked the highest profit for 2020 of SAR823.67m, 15.6% higher than the profit of SAR 712.65m posted for 2019.

Apart from Bupa Arabia, the insurers which ranked among the top five most profitable in the sector in 2020 were: Tawuniya, Al-Rajhi, AXA and Walaa. The details are:

Company

Net profit in SAR

Bupa

823,669,000

Tawuniya

514,459,000

Al-Rajhi

251,846,000

AXA

166,836,000

Walaa

72,625,000

Source: Badri

In contrast, Al Sagr booked the highest loss of SAR105.98m in 2020, 166% bigger than the loss of approximately SAR39.86m reported for 2019. Also appearing among the top five biggest loss-making insurers in 2020 were SABB, Enaya, Gulf Union Al Ahlia and Amana. The details are:

Company

Net loss in SAR

SABB

(26,538,000)

Enaya

(31,911,000)

Gulf Al Ahlia

(39,364,121)

Amana

( 57,273,000)

Al Sagr

(105,979,227)

Source: Badri

Mergers

Solidarity Saudi Takaful Company (SSTC) and Al Ahlia Cooperative Insurance have been taken over/ merged with other entities. In order to give full-year comparisons of the top line and bottom line for the Saudi insurance industry, Badri estimated the GWP and profit for both these companies. The merger of Al Ahlia with Gulf Union took place in December 2020 while SSTC’s merger with Al Jazira Takaful Taawuni Co became effective in 2021. However, SSTC and Al Ahlia are not required to publish their financials.

To include the GWP numbers for SSTC and Al Ahlia, the growth in GWP was calculated using the data for 3Q2020 and 2Q2020. Similarly, profits before tax and investment income for SSTC and Al Ahlia have been calculated by taking the proportion of profit before tax/Investment income to GWP for 2019.

To have a like-for-like comparison with last year, taking into account the financial performances of the merged insurers by estimating numbers for SSTC and Al Ahlia, this would be the position: Net profit by the 31 companies in the industry would have amounted to SAR1,828m for 2020 compared to a profit of SAR1,305m for 2019, which is an increase of around 40%.

Another insurer, Saudi Indian Company for Cooperative Insurance, announced its inability to publish its financials for 2020.


 

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