EIA-UAE Takaful Report 2013

8/11/2019 EIA-UAE Takaful Report 2013

1/23


2/23


3/23


4/23

4

Dubai Financial Market (www.dfm.ae)

Abu Dhabi Securities Exchange (www.adx.ae)

Unfortunately, the data for branches of foreign companies or the non-listed, locally

incorporated, National companies is not available publically. Hence, these companies

are not included in this analysis.

Our analysis will start with reporting and analyzing key figures of a Balance Sheet like

Assets, Liabilities, Share Capital and Equity. We will also calculate the ratio of Net profit

to these key Balance Sheet numbers. Next, we will scrutinize the important numbers

from the Income Statement and present both Underwriting results and Net Profit for the

period, as reported by each company. We will present a Reinsurance Analysis which

compares Reinsurance Premium to Gross Premium. We will compare Gross, Net and

Reinsurance Loss Ratios for all the companies as of 30 June 2012 and 2013. Finally,

we will report on General and Administrative Expenses and Net Commission for both

the quarters under study.

For these analyses, we have presented consolidated figures for all Conventional

companies and Takaful companies separately. Further, we also have provided the

figures for Q1 2013, wherever possible, to allow comparisons between the first two (2)

quarters of 2013. These total figures will act as a benchmark for any company to

compare their performance with that of the industry.

BALANCE SHEET HIGHLIGHTS

Table 1a provides figures of Assets and Liabilities for Conventional companies whose

Financial Statements are listed on one of the above-mentioned websites. The figures

provided include company-wide values as of 30 June 2013 and 31 December 2012.

As of 30 June 2013, Assets of Conventional companies have increased by 9% while

Liabilities have increased by 11% when compared with the figures as of 31 December

2012. The highest increase in Assets is reported by Dubai Insurance Company (PSC)

(DIC), with an increase of 23%. The main reasons behind the increase in Assets is

increases in their 'Financial Instruments' and 'Reinsurance Assets'. The highest

increase in Liabilities is reported by Green Crescent Insurance Company (GCIC), with

an increase of 32% in the first six months of 2013. The main reason behind the increase

in Liabilities is increases in their 'Insurance Contract Liabilities' and 'Account Payables

and Accruals'. Two conventional companies reported decreases of both their Assets

and Liabilities.

Table 1b provides figures of Assets and Liabilities for Takaful companies as of 30 June

2013 and 31 December 2012.


5/23

5

As of 30 June 2013, both Assets and Liabilities of Takaful companies have increased by

1%, when compared with the figure as of 31 December 2012. Methaq Takaful Insurance

Company PSC (METHAQ) showed the highest increase in Assets, with an increase of

25%. National Takaful Company (Watania) PJSC (Watania) reported the highest

increase in Liabilities, with an immense 135% increase.


6/23

6

Jun-13 Dec-12 % Change Jun-13 Dec-12 % Change

3-Jan-00 4-Jan-00 5-Jan-00 6-Jan-00Abu Dhabi National Insurance Company PSC 4,484 4,129 9% 2,388 2,040 17%

Al Ain Ahlia Insurance Company - Public Shareholding Company 1,670 1,552 8% 620 566 9%

Al Buhaira National Insurance Company P.S.C. 1,951 1,835 6% 1,331 1,226 9%

Al Dhafra Insurance Company P.S.C. 768 710 8% 413 398 4%

Al Fujairah National Insurance Company P.S.C. 410 376 9% 260 242 8%

Al Khazna Insurance Company P.S.C. 1,015 1,049 -3% 391 421 -7%

Al-Sagr National Insurance Company (Public Shareholding Company) 1,286 1,164 10% 692 573 21%

Al Wathba National Insurance Company PJSC 1,100 917 20% 564 468 20%

Alliance Insurance PSC 1,142 1,067 7% 769 711 8%

Orient Insurance Company PJSC and its subsidiaries 3,187 2,860 11% 1,737 1,636 6%

Arabian Scandinavian Insurance Company P.L.C. 386 376 3% 99 87 14%

Dubai Insurance Company (PSC) 683 555 23% 325 275 18%

Dubai National Insurance and Reinsurance (P.S.C.) 470 396 19% 239 205 16%

Emirates Insurance Company P.S.C 1,725 1,617 7% 842 817 3%Green Crescent Insurance Company PJSC 239 195 22% 161 122 32%

Insurance House P.S.C 258 303 -15% 125 176 -29%

National General Insurance Co. (P.S.C.) 904 867 4% 526 521 1%

Oman Insurance Company P.S.C. 5,082 4,593 11% 3,485 3,051 14%

Ras Al Khaimah National Insurance Company P.S.C. 491 436 13% 282 244 16%

Sharjah Insurance Company P.S.C. 462 392 18% 218 193 13%

Union Insurance Company P.S.C. 574 492 17% 294 235 25%

United Insurance Company P.S.C. 284 267 6% 150 151 0%

Total Conventional Companies 28,569 26,149 9% 15,910 14,357 11%

Mar-13 Jun-13 % Change Mar-12 Jun-12 % Change

Total Conventional Companies 28,206 28,569 1% 16,099 15,910 -1%

Name of CompanyAssets Liabilities

Table 1a

Financial Statement Analysis of UAE National Conventional Companies

Balance Sheet Highlights as of 30 June 2013Figures in AED million


7/23

7

Table 2a provides values for Share Capital and Equity for Conventional companies as of 30 June 2013 and 31 December

2012.

Share Capital of AKIC is increased by AED10 million during Q2 2013 as the total value of Share Capital of Conventional

companies stood at AED 4.3 billion. Among all the Conventional companies, Oman Insurance Company P.S.C. (OIC)

holds the highest amount of Share Capital at AED 462 million.

Total Equity for Conventional companies under observation is AED 12.7 billion which provides cushion to the industry in

case the actual payout to fulfill Liabilities exceeds the allotted amount. When compared with 31 December 2012 figure,

total Equity for Conventional companies increased by 7% in the first six months of 2013.


Abu Dhabi National Takaful Company PSC 485 462 5% 309 297 4%

Dar Al Takaful PJSC 177 150 18% 128 97 32%

Dubai Islamic Insurance and Reinsurance Co. (Aman) (PSC) 545 504 8% 402 361 11%

Islamic Arab Insurance Co. (Salama) and its subsidiaries 4,660 4,852 -4% 3,396 3,588 -5%

Methaq Takaful Insurance Company PSC 271 187 45% 168 89 88%

National Takaful Company (Watania) PJSC 239 181 32% 114 48 135%

Takaful Emarat - Insurance (PJSC) 199 203 -2% 126 118 7%

Total Takaful Companies 6,575 6,537 1% 4,643 4,599 1%



Table 1b

Financial Statement Analysis of UAE National Takaful Companies


Name of CompanyAssets Liabilities


8/23

8


9-Jan-00 10-Jan-00 7-Jan-00 8-Jan-00

Abu Dhabi National Insurance Company PSC 375 375 0% 2,095 2,090 0%

Al Ain Ahlia Insurance Company - Public Shareholding Company 150 150 0% 1,050 986 7%Al Buhaira National Insurance Company P.S.C. 250 250 0% 621 609 2%



Al Khazna Insurance Company P.S.C. 420 410 2% 623 628 -1%

Al-Sagr National Insurance Company (Public Shareholding Company) 230 230 0% 593 591 0%

Al Wathba National Insurance Company PJSC 180 180 0% 536 449 19%

Alliance Insurance PSC 100 100 0% 373 356 5%

Orient Insurance Company PJSC and its subsidiaries 405 405 0% 1,451 1,224 18%

Arabian Scandinavian Insurance Company P.L.C. 140 140 0% 287 289 -1%

Dubai Insurance Company (PSC) 100 100 0% 357 280 27%

Dubai National Insurance and Reinsurance (P.S.C.) 116 116 0% 231 191 21%

Emirates Insurance Company P.S.C 135 135 0% 883 800 10%

Green Crescent Insurance Company PJSC 100 100 0% 78 74 5%

Insurance House P.S.C 120 120 0% 133 127 5%

National General Insurance Co. (P.S.C.) 150 150 0% 378 346 9%

Oman Insurance Company P.S.C. 462 462 0% 1,597 1,543 4%

Ras Al Khaimah National Insurance Company P.S.C. 100 100 0% 209 192 9%

Sharjah Insurance Company P.S.C. 138 138 0% 244 199 23%

Union Insurance Company P.S.C. 331 331 0% 280 257 9%

United Insurance Company P.S.C. 100 100 0% 134 117 15%




Name of Company

Table 2a



Share Capital Equity


9/23

9

Equity of DIC is increased by 27% during 2013 which is the highest percentage increase in Equity for any Conventional

company. Equity for two (2) Conventional companies has decreased during 2013.

Table 2b above provides values for Share Capital and Equity for Takaful Companies as of 30 June 2013 and 31December 2012.

Share Capital of Takaful companies also remained unchanged during 2013 at AED 2.1 billion. Islamic Arab Insurance Co.

(Salama) and its subsidiaries (SALAMA) possesses the highest amount of Share Capital, with holdings of AED 1.2 billion.

Total Equity for Takaful companies saw a minor decrease from AED 1.94 billion at the year-end 2012 to AED 1.93 billion

as of 30 June 2013. It may be noted that their total Equity was lower at AED 1.91 billion as of 31 March 2013. Four (4)

Takaful companies reported increases in their Equity while three (3) reported decreases.


9-Jan-00 10-Jan-00 7-Jan-00 8-Jan-00

Abu Dhabi National Takaful Company PSC 100 100 0% 175 165 6%

Dar Al Takaful PJSC 100 100 0% 49 53 -7%Dubai Islamic Insurance and Reinsurance Co. (Aman) (PSC) 226 226 0% 143 142 0%

Islamic Arab Insurance Co. (Salama) and its subsidiaries 1,210 1,210 0% 1,264 1,263 0%

Methaq Takaful Insurance Company PSC 150 150 0% 103 97 5%

National Takaful Company (Watania) PJSC 150 150 0% 125 132 -5%

Takaful Emarat - Insurance (PJSC) 150 150 0% 73 85 -14%



Total Conventional Companies 2,086 2,086 0% 1,912 1,933 -1%

Table 2b



Name of CompanyShare Capital Equity


10/23

10

Net Profit

Jun-13 Dec-12 Q1&2 2013 AssetsShare

CapitalEquity

Abu Dhabi National Insurance Company PSC 47% 51% 80 2% 21% 4%

Al Ain Ahlia Insurance Company - Public Shareholding Company 63% 64% 43 3% 29% 4%

Al Buhaira National Insurance Company P.S.C. 32% 33% 25 1% 10% 4%

Al Dhafra Insurance Company P.S.C. 46% 44% 43 6% 43% 13%

Al Fujairah National Insurance Company P.S.C. 37% 36% 13 3% 13% 9%

Al Khazna Insurance Company P.S.C. 61% 60% (11) -1% -3% -2%

Al-Sagr National Insurance Company (Public Shareholding Company) 46% 51% 20 2% 8% 3%

Al Wathba National Insurance Company PJSC 49% 49% 42 4% 23% 8%

Alliance Insurance PSC 33% 33% 12 1% 12% 3%

Orient Insurance Company PJSC and its subsidiaries 46% 43% 163 5% 40% 12%

Arabian Scandinavian Insurance Company P.L.C. 74% 77% 16 4% 12% 6%

Dubai Insurance Company (PSC) 52% 51% 26 4% 26% 8%

Dubai National Insurance and Reinsurance (P.S.C.) 49% 48% 17 4% 15% 8%

Emirates Insurance Company P.S.C 51% 49% 59 4% 44% 7%

Green Crescent Insurance Company PJSC 33% 38% 3 1% 3% 3%

Insurance House P.S.C 52% 42% 6 2% 5% 4%National General Insurance Co. (P.S.C.) 42% 40% 66 7% 44% 18%

Oman Insurance Company P.S.C. 31% 34% 94 2% 20% 6%

Ras Al Khaimah National Insurance Company P.S.C. 43% 44% 27 6% 27% 14%

Sharjah Insurance Company P.S.C. 53% 51% 12 3% 9% 5%

Union Insurance Company P.S.C. 49% 52% 21 4% 6% 8%

United Insurance Company P.S.C. 47% 44% 8 3% 8% 6%

Total Conventional Companies 44% 45% 785 3% 18% 6%

Table 3a

Financial Statement Analysis of UAE National Conventional CompaniesBalance Sheet Ratios and Returns

Figures in AED million

Name of Company

Equity as % of Assets Half-yearly Return on


11/23

11

BALANCE SHEET RATIOS AND RETURNS

Table 3a presents Equity as Percentage of Assets for Conventional companies as of 30 June 2013 and 31 December

2012. The table also shows Half-Yearly Return for Conventional companies on Assets, Share Capital and Equity for Q1&2

2013.

Equity as Percentage of Assets tells us how much in assets a company holds over and above their liabilities. The higher

the ratio, the lower the risk the company possesses. For Conventional companies, this ratio is 44% and 45% as of 30

June 2013 and 31 December 2012, respectively. Some companies showed noticeable deterioration in this ratio; however,

for most of the companies, this ratio is fairly stable at company level, showing minor changes when comparing 30 June

2013 and 31 December 2012 figures.

Arabian Scandinavian Insurance Company P.L.C. (ASIC) has shown the highest Equity as percentage of Assets among

Conventional companies.

Net Profit

Jun-13 Dec-12 Q1&2 2013 AssetsShare

CapitalEquity

Abu Dhabi National Takaful Company PSC 36% 36% 20 4% 20% 12%

Dar Al Takaful PJSC 28% 35% (4) -2% -4% -7%

Dubai Islamic Insurance and Reinsurance Co. (Aman) (PSC) 26% 28% (9) -2% -4% -6%

Islamic Arab Insurance Co. (Salama) and its subsidiaries 27% 26% 13 0% 1% 1%

Methaq Takaful Insurance Company PSC 38% 52% 5 2% 4% 5%

National Takaful Company (Watania) PJSC 52% 73% (7) -3% -5% -5%

Takaful Emarat - Insurance (PJSC) 37% 42% (12) -6% -8% -15%

Total Takaful Companies 29% 30% 6 0% 0% 0%

Financial Statement Analysis of UAE National Takaful CompaniesBalance Sheet Ratios and Returns

Table 3b


Name of Company

Equity as % of Assets Half-yealry Return on


12/23

12

Half-yearly Return on Assets is calculated by dividing the Half-Yearly Net Profit by

average assets during the period of the study. Return on Assets for all Conventional

companies, on a consolidated basis, is 3%. Some Conventional companies have shown

the Half-Yearly Return on Assets equal to or greater than 6%. These include Al Dhafra

Insurance Company P.S.C. (DHAFRA), National General Insurance Co. P.S.C. (NGIC)

and Ras Al Khaimah National Insurance Company P.S.C. (RAKNIC).

Return on Share Capital explains how efficiently a company utilizes its capital. This ratio

is calculated by dividing Net Profit by average Share Capital during the period of the

study. Half-Yearly Return on Capital for Conventional companies is 18%. Return on

Capital for companies like DHAFRA, NGIC and Emirates Insurance Company (EIC) is

above 40%.

Return on Equity is calculated by dividing Net Profit by average equity during the

analysis period. Industry wide, Conventional companies' Half-Yearly Return on Equity is

6%. DHAFRA, Orient Insurance Company (PJSC) and its subsidiaries (ORIENT), NGICand RAKNIC have all shown Return on Equity in double-digits.

Table 3b shows Equity as Percentage of Assets for Takaful companies as of 30 June

2013 and 31 December 2012. The table also shows Half-Yearly Return for Takaful

companies on Assets, Share Capital and Equity. For Takaful companies, the ratio of

Equity as Percentage of Assets is only 29% as of 30 June 2013 compared to 44% for

Conventional companies.

For Takaful companies, Half-Yearly Returns on Assets, Share Capital and Equity for the

first half of the year are all 0%, which is an improvement from the first quarter where thereturns were negative, on a consolidated basis. Three Takaful companies have positive

returns: Abu Dhabi National Takaful Company PSC (ADNTC), SALAMA and METHAQ,

while the returns for the rest of the Takaful companies, on an individual basis, are

negative.

INCOME STATEMENT -NET PROFIT

Table 4a presents different Income Statement figures for Conventional companies for

both 30 June 2013 and 30 June 2012.

Conventional companies registered 10% and 7% increase in their Net Premium Earned

and Net Incurred Claims, respectively, from 30 June 2012 to 30 June 2013. Some

companies showed very high change in Net Premium Earned and Net Incurred Claims,

when comparing the figures between 2012 and 2013. Net Premium Earned and Net

Claims incurred in Q2 2013 alone are much lower than those in Q1 2013.


13/23

13

Actuarially speaking, we like to compare Net Premium Earned and to Net Incurred Claims. While most companies

reported their numbers in this way, some companies showed their numbers without specifying the change in unearned

premiums or change in outstanding claims. As in our last report, we assumed, for the sake of consistency, that all Net

Premiums are Net Earned and all Net Claims are Net Incurred Claims.

Q1&2 2013 Q1&2 2012 %Change Q1&2 2013 Q1&2 2012 %Change Q1&2 2013 Q1&2 2012 %Change Q1&2 2013 Q1&2 2012 %Change

Abu Dhabi National Insurance Company PSC 368 295 25% 266 204 31% 108 104 4% 80 86 -7%

Al Ain Ahlia Insurance Company - Public Shareholding Company 131 105 25% 81 76 8% 52 42 25% 43 36 18%

Al Buhaira National Insurance Company P.S.C. 124 152 -18% 125 140 -10% 36 51 -28% 25 35 -29%Al Dhafra Insurance Company P.S.C. 118 104 14% 80 57 40% 42 48 -12% 43 41 3%

Al Fujairah National Insurance Company P.S.C. 58 58 -1% 48 45 7% 21 23 -9% 13 11 14%

Al Khazna Insurance Company P.S.C. 24 35 -33% 17 20 -15% 8 16 -50% (11) 12 -192%

Al-Sagr National Insurance Company (Public Shareholding Company) 123 116 6% 102 99 2% 39 39 0% 20 22 -10%

Al Wathba National Insurance Company PJSC 122 109 12% 102 102 -1% 32 14 130% 42 (0) 13105%

Alliance Insurance PSC - - N/A - - N/A 8 6 40% 12 9 31%

Orient Insurance Company PJSC and its subsidiaries 236 206 15% 107 91 19% 152 143 6% 163 145 13%

Arabian Scandinavian Insurance Company P.L.C. 24 21 14% 13 10 36% 10 13 -26% 16 18 -10%

Dubai Insurance Company (PSC) 44 35 25% 21 21 0% 21 18 16% 26 21 21%

Dubai National Insurance and Reinsurance (P.S.C.) 29 20 48% 15 10 57% 15 12 24% 17 14 22%

Emirates Insurance Company P.S.C 162 135 20% 84 77 9% 68 61 11% 59 64 -8%

Green Crescent Insurance Company PJSC 23 55 -59% 12 52 -76% 9 1 498% 3 (14) 118%

Insurance House P.S.C 25 13 101% 12 6 106% 8 4 108% 6 6 -9%

National General Insurance Co. (P.S.C.) 146 136 8% 105 100 5% 43 42 4% 66 26 150%

Oman Insurance Company P.S.C. 621 569 9% 425 362 18% 186 226 -18% 94 126 -25%

Ras Al Khaimah National Insurance Company P.S.C. 86 67 29% 46 32 44% 35 33 7% 27 23 19%

Sharjah Insurance Company P.S.C. 19 28 -31% 22 36 -40% 6 1 557% 12 7 84%

Union Insurance Company P.S.C. 67 61 10% 43 78 -44% 33 (18) 277% 21 (37) 157%

United Insurance Company P.S.C. 43 38 13% 40 36 10% 5 5 4% 8 (0) 2652%

Total Conventional Companies 2,593 2,358 10% 1,768 1,652 7% 938 884 6% 785 653 20%

Q1 2013 Q2 2013 % Change Q1 2013 Q2 2013 % Change Q1 2013 Q2 2013 % Change Q1 2013 Q2 2013 % Change

Total Conventional Companies 1,552 1,041 - 49% 1,008 760 -33% 611 327 -87% 529 256 -107%

Name of CompanyNet Premium Earned Net Incurred Claims Net Underwriting Income Net Profit

Table 4a

Financial Statement Analysis of UAE National Conventional companies

Income Statement - Net ProfitFigures in AED million


14/23

14

Net Underwriting Income shows the income of the company, before expenses and investment income are considered. It

demonstrates the skill that a company has in running its core business: insurance underwriting. For Conventional

companies on a consolidated basis, the total Net Underwriting Income for 2013 as of 30 June is AED 938 million, an

increase of 6% from 30 June 2012. Some companies like AKIC, ASIC, OIC and Al Buhaira Insurance Company P.S.C.

(ABNIC) showed substantial reduction in the value of their Net Underwriting Income as of 30 June 2013 when compared

with 30 June 2012.

Net Profit is one of the most important indicators on an Income Statement. On a consolidated basis, Conventional

companies had AED 785 million in Net Profit as of 30 June 2013, compared to AED 653 million as of 30 June 2012, an

increase of 20%. On an individual basis, the results are mixed: some companies showed remarkable improvement in their

Net Profit while others reported significant decreases. It is encouraging to see that only one (1) Conventional company

reported negative Net Profit as of 30 June 2013 when four (4) companies reported negative Net Profit as of 30 June 2012.

Q1&2 2013 Q1&2 2012 % Change Q1&2 2013 Q1&2 2012 % Change Q1&2 2013 Q1&2 2012 % Change Q1&2 2013 Q1&2 2012 % Change

Abu Dhabi National Takaful Company PSC 46 37 27% 12 11 8% 32 25 28% 20 12 69%

Dar Al Takaful PJSC 39 15 169% 31 9 250% 5 3 44% (4) (6) 33%

Dubai Islamic Insurance and Reinsurance Co. (Aman) (PSC) 64 59 8% 55 37 48% 8 20 -57% (9) (2) -374%

Islamic Arab Insurance Co. (Salama) and its subsidiaries 628 940 -33% 389 569 -32% 75 105 -28% 13 41 -69%

Methaq Takaful Insurance Company PSC 31 36 -13% 31 26 19% (3) 7 -146% 5 (6) 197%

National Takaful Company (Watania) PJSC 12 3 358% 53- 9- 489% 65 11 469% (7) (6) -25%

Takaful Emarat - Insurance (PJSC) 18 5 284% 9 3 209% 3 0 1207% (12) (10) -26%

Total Takaful Companies 839 1,093 -23% 474 647 -27% 186 172 8% 6 24 -75%

Q1 2013 Q2 2013 % Change Q1 2013 Q2 2013 % Change Q1 2013 Q2 2013 % Change Q1 2013 Q2 2013 % Change

Total Takaful Companies 471 369 -28% 304 170 -79% 53 133 60% (12) 18 166%

Table 4b

Financial Statement Analysis of UAE National Takaful companiesIncome Statement - Net Profit


Name of CompanyNet Premium Earned Net Incurred Claims Net Underwriting Income Net Profit


15/23


16/23

16

As of 30 June 2013, Takaful companies in total have lower Re-Takaful levels (33%)

than their Conventional counterparts (52%).


17/23

17

Q1&2 2013 Q1&2 2012 % Change Q1&2 2013 Q1&2 2012 % Change Q1&2 2013 Q1&2 2012

Abu Dhabi National Insurance Company PSC 747 735 2% 355 380 -7% 48% 52%Al Ain Ahlia Insurance Company - Public Shareholding Company 316 281 13% 176 166 6% 56% 59%

Al Buhaira National Insurance Company P.S.C. 298 303 -1% 180 171 5% 60% 57%

Al Dhafra Insurance Company P.S.C. 191 185 3% 70 73 -3% 37% 39%

Al Fujairah National Insurance Company P.S.C. 88 90 -2% 28 32 -11% 32% 35%

Al Khazna Insurance Company P.S.C. 49 94 -48% 30 35 -14% 62% 37%

Al-Sagr National Insurance Company (Public Shareholding Company) 243 219 11% 98 84 17% 40% 38%

Al Wathba National Insurance Company PJSC 301 246 23% 153 104 48% 51% 42%

Alliance Insurance PSC N/A N/A N/A N/A N/A N/A N/A N/A

Orient Insurance Company PJSC and its subsidiaries 843 765 10% 585 547 7% 69% 71%

Arabian Scandinavian Insurance Company P.L.C. 41 41 0% 16 19 -12% 40% 46%

Dubai Insurance Company (PSC) 187 200 -6% 134 162 -17% 72% 81%

Dubai National Insurance and Reinsurance (P.S.C.) 100 58 73% 59 37 60% 59% 63%

Emirates Insurance Company P.S.C 410 350 17% 208 210 -1% 51% 60%

Green Crescent Insurance Company PJSC 82 66 24% 25 21 22% 31% 31%

Insurance House P.S.C 42 27 56% 14 6 147% 34% 21%

National General Insurance Co. (P.S.C.) 275 253 9% 76 80 -4% 28% 32%

Oman Insurance Company P.S.C. 1,586 1,384 15% 836 766 9% 53% 55%

Ras Al Khaimah National Insurance Company P.S.C. 163 130 25% 69 58 19% 42% 45%Sharjah Insurance Company P.S.C. 57 62 -7% 28 37 -25% 48% 60%

Union Insurance Company P.S.C. 187 134 39% 115 66 75% 62% 49%

United Insurance Company P.S.C. 74 80 -7% 25 33 -24% 33% 41%

Total Conventional companies 6,282 5,702 10% 3,283 3,085 6% 52% 54%

Q1 2013 Q2 2013 % Change Q1 2013 Q2 2013 % Change Q1 2013 Q2 2013

Total Conventional companies 3,758 2,524 -49% 1,932 1,351 -43% 51% 54%

Table 5a

Financial Statement Analysis of UAE National Conventional companies

Reinsurance RatiosFigures in AED million

Name of CompanyGross Premium Reinsurance Premium

Reins Prem as % of

Gross Prem


18/23

18

LOSS RATIOS

Table 6a shows Gross, Reinsurance and Net Loss Ratios for Conventional companies.

Gross Loss Ratio is calculated by dividing Gross Incurred Claims by Gross Earned Premium. Reinsurance Loss Ratio is

calculated by dividing Reinsurance Incurred Claims by Reinsurance Earned Premium. Finally, Net Loss Ratio iscalculated by dividing Net Incurred Claims by Net Earned Premium.

For Conventional companies, Net Loss Ratio is higher than Reinsurance Loss Ratio 68% versus 51%, respectively, as

of 30 June 2013. This shows that Conventional companies are not using reinsurance in an optimal way. Loss Ratios or

claims experience of reinsurance companies is much better than that of these insurance companies.

Q1&2 2013 Q1&2 2012 % Change Q1&2 2013 Q1&2 2012 % Change Q1&2 2013 Q1&2 2012

Abu Dhabi National Takaful Company PSC 125 91 37% 71 53 34% 57% 58%

Dar Al Takaful PJSC 57 39 48% 15 10 59% 27% 25%

Dubai Islamic Insurance and Reinsurance Co. (Aman) (PSC) 204 199 2% 140 140 0% 69% 70%

Islamic Arab Insurance Co. (Salama) and its subsidiaries 730 1,243 -41% 137 213 -36% 19% 17%

Methaq Takaful Insurance Company PSC 109 33 233% 17 12 38% 15% 37%

National Takaful Company (Watania) PJSC 69 21 224% 38 12 220% 55% 56%

Takaful Emarat - Insurance (PJSC) 45 57 -22% 19 34 -46% 42% 60%

Total Takaful Companies 1,339 1,683 -20% 436 474 -8% 33% 28%

Q1 2013 Q2 2013 % Change Q1 2013 Q2 2013 % Change Q1 2013 Q2 2013

Total Takaful Companies 722 616 -17% 208 228 9% 29% 37%

Table 5b

Financial Statement Analysis of UAE National Takaful companies

Reinsurance RatiosFigures in AED million

Name of CompanyGross Premium Reinsurance Premium

Reins Prem as % of

Gross Prem


19/23


20/23

20

Table 6b shows Gross Loss Ratio, Reinsurance Loss Ratio and Net Loss Ratio for Takaful companies.

Experience of Takaful companies, on the whole, is not different from their Conventional counterparts. Reinsurance Loss

Ratios for Takaful companies are considerably lower than their Net Loss Ratios. However, as with all averages, there are

significant variations between the companies.

Table 7a presents figures for General and Administrative Expenses and Net Commission for all of the Conventional

companies included in the study. Net Commission is equal to the difference between commission income from the

reinsurers and commission expenses incurred by the companies.

On a consolidated basis, Conventional companies incurred 19% more in expenses, at AED 617 million as of 30 June

2013, when compared with 30 June 2012. OIC reported the highest expenses of AED 183 million and AED 125 million as

of 30 June 2013 and 30 June 2012, respectively, which is a 47% increase year on year.

Q1&2 2013 Q1&2 2012 Q1&2 2013 Q1&2 2012 Q1&2 2013 Q1&2 2012

Abu Dhabi National Takaful Company PSC 27% 56% 28% 73% 26% 31%

Dar Al Takaful PJSC 76% 55% 65% 42% 78% 60%

Dubai Islamic Insurance and Reinsurance Co. (Aman) (PSC) 49% 28% 32% 13% 86% 63%

Islamic Arab Insurance Co. (Salama) and its subsidiaries 79% 58% 58% 59% 62% 61%

Methaq Takaful Insurance Company PSC 96% 82% 77% 104% 101% 74%

National Takaful Company (Watania) PJSC -46% -27% 57% 27% -425% -331%

Takaful Emarat - Insurance (PJSC) 49% 76% 47% 87% 51% 63%

Total Takaful Companies 62% 54% 45% 47% 57% 59%

Table 6b

Financial Statement Analysis of UAE National Takaful companies

Loss Ratios

Name of CompanyGross Loss Ratio

Reinsurance Loss

RatioNet Loss Ratio


21/23

21

Q1&2 2013 Q1&2 2012 % Change Q1&2 2013 Q1&2 2012 % Change

Abu Dhabi National Insurance Company PSC 49 43 14% 10 12 -19%

Al Ain Ahlia Insurance Company - Public Shareholding Company 27 21 27% 2 12 -83%

Al Buhaira National Insurance Company P.S.C. 17 20 -13% 38 38 -1%



Al Khazna Insurance Company P.S.C. 20 24 -14% 2 1 106%

Al-Sagr National Insurance Company (Public Shareholding Company) 27 25 7% 18 22 -18%

Al Wathba National Insurance Company PJSC 22 20 7% 11 7 58%Alliance Insurance PSC N/A N/A N/A N/A N/A N/A

Orient Insurance Company PJSC and its subsidiaries 67 57 18% 23 28 -17%

Arabian Scandinavian Insurance Company P.L.C. 7 6 5% (1) 2 -126%

Dubai Insurance Company (PSC) 8 8 2% (1) 2 -165%

Dubai National Insurance and Reinsurance (P.S.C.) 10 9 4% (1) 1 -247%

Emirates Insurance Company P.S.C 37 34 6% (9) 4 -326%

Green Crescent Insurance Company PJSC 15 19 -21% (2) (3) 38%

Insurance House P.S.C 8 6 28% (4) (3) -45%

National General Insurance Co. (P.S.C.) 23 19 22% 2 5 -69%

Oman Insurance Company P.S.C. 183 125 47% (29) 2 -1871%

Ras Al Khaimah National Insurance Company P.S.C. 13 13 8% (5) (2) -167%

Sharjah Insurance Company P.S.C. 7 6 29% 9 9 -6%

Union Insurance Company P.S.C. 36 25 45% 9 (2) 542%

United Insurance Company P.S.C. 10 9 9% 3 4 -33%

Total Conventional Companies 617 518 19% 89 152 -41%

Q1 2013 Q2 2013 Change Q1 2013 Q2 2013 Change

Total Conventional Companies 315 302 -4% 55 34 -62%

Table 7a


Expenses and Net CommissionFigures in AED million

Name of CompanyGeneral and Administrative Expense Net Commission


22/23

22

Net Commission earned by Conventional companies reported as of 30 June 2013 is AED 89 million which is 41% lessthan the figure reported in 2012. Many big companies reported substantial decrease in their Net Commission while some

companies showed improvement in their Net Commission figures when comparing between Q1&2 2012 and Q1&2 2013.

Table 7b shows figures for General and Administrative Expenses and Net Commission for Takaful companies. Takaful

companies, on a consolidated basis, reported the same General and Administrative Expenses (AED 185 million) when

compared between Q1&2 2012 and Q1&2 2013. Only ADNTC and SALAMA reported a decrease in their expenses, while

all other Takaful companies incurred greater General and Administrative expenses, as of 30 June 2013. Though still a

negative figure, Net Commission earned by Takaful companies is 34% higher in 2013 than for the same period in 2012.

All of the Takaful companies consistently reported negative value for Net Commission.

Q1&2 2013 Q1&2 2012 % Change Q1&2 2013 Q1&2 2012 % Change

Abu Dhabi National Takaful Company PSC * 15 15 -1% N/A N/A N/A

Dar Al Takaful PJSC 10 10 1% (3) (2) -45%

Dubai Islamic Insurance and Reinsurance Co. (Aman) (PSC) 25 24 6% (7) (6) -15%

Islamic Arab Insurance Co. (Salama) and its subsidiaries 97 105 -8% (164) (266) 38%

Methaq Takaful Insurance Company PSC 11 10 13% (3) (2) -24%

National Takaful Company (Watania) PJSC 10 7 37% (0) (0) 9%

Takaful Emarat - Insurance (PJSC) 18 14 21% (6) (2) -290%

Total Takaful Companies 185 185 0% (183) (278) 34%

Q1 2013 Q2 2013 Change Q1 2013 Q2 2013 Change

Total Takaful Companies 101 85 -19% (115) (69) -67%

* Commission paid figure not available separtely

Table 7b


Expenses and Net CommissionFigures in AED million

Name of CompanyGeneral and Administrative Expense Net Commission


23/23

Date post:	02-Jun-2018
Category:	Documents
Upload:	innovativeone
View:	220 times
Download:	0 times

EIA-UAE Takaful Report 2013

Documents