Egyptian Takaful Properties and Liabilities Insurance Company (Egyptian Takaful) has a track record of solid operating performance despite the challenging macroeconomic conditions in Egypt, notes AM Best which assesses Egyptian Takaful's operating performance as adequate.
However, in 2025, the company reported a return-on-equity and net/net combined ratio, as calculated by AM Best, of -36.3% and 183.5%, respectively. The net loss was mainly driven by material underwriting losses within its legacy credit insurance portfolio. These losses are considered to be one-off in nature and performance is expected to return to the historically profitable levels seen before 2025.
Ratings affirmed
AM Best has affirmed Egyptian Takaful’s Financial Strength Rating of ‘B-’ (Fair), Long-Term Issuer Credit Rating of “bb-” (Fair) and Egypt National Scale Rating of ‘aa+.EG’ (Superior). The outlook of these credit ratings is ‘Stable’.
The ratings reflect Egyptian Takaful’s balance sheet strength, which AM Best assesses as strong, as well as its adequate operating performance, limited business profile and marginal enterprise risk management (ERM).
AM Best evaluates the company’s risk-adjusted capitalisation on a combined basis, including its policyholders’ and shareholders’ funds, due to the stated mandate within its articles of association that require the shareholders’ fund to support the policyholders’ fund. Egyptian Takaful’s risk-adjusted capitalisation at year-end 2025 fell to the weak level, as measured by Best’s Capital Adequacy Ratio (BCAR), due primarily to material underwriting losses stemming from its legacy credit insurance portfolio. The balance sheet strength assessment factors in the expected improvement of the company’s BCAR score over the short term.
Despite Egyptian Takaful’s conservative investment allocation by asset class, AM Best considers the quality of its assets to be weak given the company’s concentration in Egypt.
The company has a relatively high reliance on reinsurance, evident by an insurance revenue retention ratio of 43.4% in 2025. However, the associated counterparty credit risk is mitigated by the use of a financially strong reinsurance panel.
Business profile
The business profile assessment reflects Egyptian Takaful’s position as a mid-tier takaful insurer in Egypt, with a non-life market share of approximately 5%. However, the company’s profile is limited to operating within Egypt and is moderately concentrated in the credit and energy insurance lines, which accounted for 27.9% and 21.0% of gross contract revenue in 2025, respectively.
In recent years, Egyptian Takaful has undertaken steps to formalise its ERM function and promote a risk-aware culture across the organisation. AM Best expects that further improvements in Egyptian Takaful’s ERM framework and practices will support the company as it executes its strategic business plan.