The impact of intense price competition in medical and certain motor segments are now coming through in the Saudi insurance market, says Badri Management Consultancy, an international company specialising in actuarial and management consulting services.
In the report titled 'KSA – Listed Insurance Industry Performance Analysis – 1Q2025', Badri says that with a few notable exceptions, 1Q2025 has been a disastrous one. Without sharp price corrections, 2025 will be a very difficult year of losses for many.
The insurance industry’s profitability (after-zakat & tax) declined 28% in the first three months of 2025 to SAR0.6bn ($160m) from SAR0.9bn in 1Q2024. Performance was mixed. The top three insurers – BUPA, Tawuniya and Al Rajhi – saw profit gains of 6%, 33%, and -18%, respectively, totaling SAR0.7bn. Meanwhile, 19 insurers reported a profit drop averaging -119%, totaling SAR401m. While GIG, SAICO, and Enaya posted notable profit gains, many others faced significant declines.
Total insurance revenue grew by 6%, increasing from SAR16bn to SAR17 bn. Without the top three industry players, the industry's growth was 5%.
Overall underwriting performance declined, with insurance service results decreasing by 24%, from SAR816m in 1Q2024 to SAR620m in 1Q2025. 18 companies reported a significant drop in insurance service results compared to the prior year. Investment income dropped by 17%, from SAR787m in 1Q2024 to SAR652m in 1Q2025, often balancing weaker underwriting outcomes.
Excluding the top three companies, the industry recorded a loss of SAR96m, down from SAR219m in 1Q2024, reflecting a 144% drop. Based on recent history in this market, with results such as these, price rises often follow.
Except for BUPA and Tawuniya, the vast majority of medical underwriters made technical losses or suffered sharp drops in profits during 2024. There has been a lack of focus on technical results, with market premiums at unprofitable levels for too long in medical and certain motor segments – the full results will be more revealing when they’re published.
To download the complete report, please click on this link.