TIMMINT MI Saudi Arabia (KSA) Insurance Weekly Report

1. SAUDI ARABIA INSURANCE
Weekly Report
Issue - 2014 Week 20
09 to 15 May, 2014

2. TIMMINT Market Intelligence KSA Insurance Weekly Report 09 to 15 May, 2014
2
From:
TIMMINT
Market Intelligence
To:
Whom it may concern
Subject:
Weekly Status Report, Saudi
Arabia Insurance Industry.
Issue Year 2014, Week 20
Report Sections Page
KSA INSURANCE
NEWS
2
TADAWUL
INSURANCE INDEX
5
MARKET
PERFORMANCE
6
COMPANIES
PERFORMANCE
7
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Disclaimer:
This report was prepared as an
account of work sponsored by the
Company. Certain information has
been obtained from published
sources and is given as of the dates
specified. All the information in this
publication is verified to the best of
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assumes any legal liability or
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KSA INSURANCE NEWS
A.M. Best Special Report: Market Review: Competition,
Top-line Growth Dampen Saudi Insurers' 2013 Performance
Saudi Arabia's insurance market remains one of the main markets within the Gulf Cooperation
Council, with premiums expected to surpass the United Arab Emirates over the next five years,
according to a new report from A.M. Best.
The group said the insurance market saw premiums expand significantly in 2013, and although
growth is expected to slow in 2014, it remains above historical levels.
According to the report, "Competition, Top-line Growth Dampen Saudi Insurers' 2013
Performance," while growth in recent years has been mainly driven by compulsory motor and
medical, the Saudi market saw a substantial loss-making year in 2013, stemming mainly from
inadequate pricing and material reserve deficiencies in the motor and medical portfolios.
Most of the market's premium growth comes from rate increases in these lines of business, with
rates likely to continue rising, as actuaries will need to review technical pricing over the coming
years.
Mahesh Mistry, director, analytics, said: "The challenge that the Saudi insurance market has faced
in recent years has strained not just underwriting performance but also capital adequacy, which
has been in decline in recent years, with net underwriting leverage substantially increasing.
Many insurers have seen a significant erosion of capital and surplus over the past two years. The
market overall needs a capital injection to replenish capital levels, while the process of infusing
capital needs to be accelerated."
A.M. Best expects that strains on capital adequacy and profitability will
likely continue for Saudi insurers in 2014. Many insurers are still below
minimum capital requirements. Continued pressure on operating
performance will likely cause a further strain on risk-adjusted
capitalisation. Solvency margins that are under strain may encourage
reinsurers to offer capital relief programmes.
The uncertainties over the effects of the Saudi Arabian Monetary Agency's (SAMA) 2013 actuarial
review of the technical pricing of both medical and motor insurance have several implications.
Vasilis Katsipis, general manager, market development - MENA, South & Central Asia, added:
"A.M. Best believes that underperforming companies may become less competitive in the market
as their franchises may be affected, while the top performers in these business lines may have
greater flexibility in pricing."
Source: insurancenewsnet.com
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3. TIMMINT Market Intelligence KSA Insurance Weekly Report 09 to 15 May, 2014
3
A.M. Best Downgrades Ratings of The Mediterranean & Gulf
Insurance & Reinsurance Company B.S.C. (c) and its Main
Subsidiary
A.M. Best has downgraded the financial strength rating to A- (Excellent) from A (Excellent) and
issuer credit rating to “a-” from “a” of The Mediterranean & Gulf Insurance & Reinsurance
Company B.S.C. (c) (Medgulf Bahrain) and of The Mediterranean and Gulf Cooperative Insurance
and Reinsurance Company (A Saudi Joint Stock Company) (Medgulf KSA). The outlook for all
ratings remains stable.
The rating downgrades reflect the reduction in Medgulf Bahrain’s risk-adjusted capitalisation in
2013 following a change in its reserving methodology, which resulted in a material underwriting
loss at the Saudi subsidiary.
In 2013, the entire Saudi insurance market increased the level of conservatism in the calculation of
technical reserves, as instructed by the Saudi Arabian Monetary Agency (SAMA). The change in
reserving basis followed a market-wide strategic review of insurance products, with motor and
medical business lines receiving the greatest scrutiny.
Auditors and actuaries were instructed by SAMA to be more conservative in their assessments of
companies’ technical reserves. In 2013, Medgulf KSA reported an increase in net reserves for
outstanding claims of SAR 466 million (USD 126 million), producing a net loss of SAR 192 million
(USD 51 million) that drove a 16% decrease in the shareholders’ equity. On a consolidated basis,
Medgulf Bahrain reported a net loss of SAR 243 million (USD 65 million), reducing shareholders’
equity by 11%.
While this increase in technical reserves has affected Medgulf KSA’s risk-
adjusted capitalisation, A.M. Best expects the company’s historically strong
operating performance to return and stabilise the group’s capital position.
Medgulf KSA has produced solid earnings for the first quarter of 2014,
reporting a net profit of SAR 51 million (USD 14 million).
Upward rating movement for Medgulf Bahrain could result from evidence that this reserve charge
was a one-time event, and through an improvement in risk-adjusted capitalisation to a level that is
supportive of a higher rating. Downward rating pressure could occur if there was a further
deterioration in Medgulf Bahrain’s operating performance or its risk-adjusted capitalisation was to
decrease to a level not supportive of the current ratings.
The ratings of Medgulf KSA benefit from rating enhancement from Medgulf Bahrain, given its
strategic importance to the group. Upwards and downwards rating movement for Medgulf KSA
could result from a change in its stand-alone assessment or a change in parental support.
Source: Marketwatch
Medgulf lost
$51 million
16% decrease
in
shareholder’s
equity
USD 126
million
increase in net
reserves

4. TIMMINT Market Intelligence KSA Insurance Weekly Report 09 to 15 May, 2014
4
Consolidation, Private Equity and Emerging-Market Interest
Drove 2013 Global Insurance Merger and Acquisition
Activity
Global insurance merger and acquisition (M&A) activity in 2013 within the property/casualty,
life/health and reinsurance sectors was driven largely by industry consolidation, A.M. Best
research has found, as many companies have been looking to divest noncore assets post-financial
crisis.
According to a release, the number of 2013 deals in
the property/ casualty and reinsurance sectors fell
roughly 25% compared with 2012, while the
life/health industry saw a 15% rise in activity in 2013
over the previous year. While consolidation is an M&A
trend running through all these sectors, private equity
also had a pronounced influence on dealings, as firms
have been focused on increasing their participation in
the insurance sectors.
In addition, interest in emerging markets, as a means to diversify globally and to combat low
interest rates, has increasingly become a driver of M&A activity as well. This review is the
centerpiece of the latest Best's Journal, a biweekly publication that presents A.M. Best's original
research, analysis and commentary on the global insurance industry, available exclusively as part
of a subscription to the Best's Insurance News & Analysis service.
One of the highlights in this issue of Best's Journal included:
Competition, Top-Line Growth Dampen Saudi Insurers' 2013 Performance:
Saudi Arabia's insurance market saw a loss-making year in 2013, due
primarily to inadequate pricing and material reserve deficiencies in the motor
and medical portfolios, according to a Best's Special Report.
Source: insurancenewsnet.com

5. TIMMINT Market Intelligence KSA Insurance Weekly Report 09 to 15 May, 2014
5
TADAWUL INSURANCE INDEX
Insurance Sector Performance:
The Tadawul insurance index chart illustrates the global performance of all Saudi insurance companies in the stock market, for a
period of one year, showing a year to date change of (21.69%).
Insurance Index - Year to Date Figures
Index as of 31 Dec Current Index Indicator YTD Change % of change
1,207.18 1,468.78 261.80 21.69%
Insurance Index (One Year)
--- Volume --- Index
Tadawul All Share Index - TASI (One Year)
--- Volume --- Index
Insurance Index - 52 Weeks Price
High Date Low Date Current Price
1,382.66 2013/04/15 1,031.43 2013/09/09 1,468.78

6. TIMMINT Market Intelligence KSA Insurance Weekly Report 09 to 15 May, 2014
6
MARKET PERFORMANCE
The tables hereunder reflect the performance of the listed insurance companies during the last 6 days.
* Last 6 days. * Last 6 days.
* Last 6 days.
* Last 6 days. * Last 6 days.
Company
Price
Begin High Low End
Tawuniya 46.5 46.9 45.4 46.1
Medgulf 35.8 36.9 35.4 36.4
Malath Insurance #N/A #N/A #N/A #N/A
Arabian Shield #N/A #N/A #N/A #N/A
SALAMA 39 47.9 38.9 46
SABB Takaful 45.4 48.2 45 46.4
SAICO 51.75 54 51.5 53.5
ATC 60.75 64.5 60 62.25
Gulf Union 27.1 30.9 26.9 29.9
SANAD 20.8 22.55 20.65 22.05
Allianz sf 62.75 66.5 62.25 65.5
Trade Union 28.6 31.1 28.2 30.2
Sagr Insurance #N/A #N/A #N/A #N/A
WAFA Insurance 109.5 113.7
5
98.25 98.25
AICC 23.8 24.6 22.95 24.05
Walaa Insurance 31.4 32.8 31.2 32.2
Saudi Re 13.5 13.65 13.35 13.55
Company
Price
Begin High Low End
Bupa Arabia 88 97 85.75 91.5
U C A 27.6 29 27.4 28.5
Al-Ahlia 59 63.5 58.5 59.25
ACIG 29.1 31.4 28.7 30.3
Al Rajhi Takaful #N/A #N/A #N/A #N/A
ACE 67 77 66.5 77
Al Alamiya 100.75 104 97 99.25
AXA-Cooperative #N/A #N/A #N/A #N/A
Gulf General 46.5 49 46.2 48
Weqaya Takaful 25 26 24.9 24.9
Buruj 53 56.25 52.5 56
Wataniya 105.5 108.5 103 103.75
AMANA #N/A #N/A #N/A #N/A
Solidarity 25.9 26.7 25.5 26.2
Enaya 46.6 48.3 45.9 46.4
Alinma Tokio M #N/A #N/A #N/A #N/A
Jazira Takaful 59.75 62 58.5 59.75
ANB insurance #N/A #N/A #N/A #N/A
Top 5 Most Active by Volume
Company Volume Value
Amana Insurance 25,389,344 70,625,446
Saudi Re 19,378,286 39,807,330
Solidarity 15,508,031 39,001,147
SANAD 10,812,870 78,496,019
Gulf Union 9,718,074 78,399,141
Top 3 Gainers/Losers by Value
Company
Change
Value %
ACE 10 14.93
SALAMA 7 17.95
Bupa Arabia 3.5 3.98
Company
Change
Value %
WAFA Insurance -11.25 -10.27
Wataniya -1.75 -1.66
Al Alamiya -1.5 -1.49
Top 3 Gainers/Losers by Percentage
Company
Change
Value %
SALAMA 7 17.95
ACE 10 14.93
Gulf Union 2.8 10.33
Company
Change
Value %
WAFA Insurance -11.25 -10.27
Wataniya -1.75 -1.66
Al Alamiya -1.5 -1.49

7. TIMMINT Market Intelligence KSA Insurance Weekly Report 09 to 15 May, 2014
7
COMPANIES PERFORMANCE
Tadawul – Insurance Companies Charts:
There are presently 35 listed insurance companies onto the Tadawul Stock Exchange.
The charts below show their evolution in price and volume for a period of one year or since their first introduction to the
list/quote.
Tawuniya
Price Change
Begin High Low End Value %
30.8 49.8 28.6 46.1 15.3 49.68
* One year data --Volume --Last Trade Price
MedGulf
Price Change
Begin High Low End Value %
27.1 37.9 20.5 36.4 9.3 34.32
* One year data --Volume --Last Trade Price
Malath
Price Change
Begin High Low End Value %
#N/A #N/A #N/A #N/A #N/A #N/A
* One year data --Volume --Last Trade Price
Arabian Shield
Price Change
Begin High Low End Value %
47.5 61.5 29.9 59 11.5 24.21
* One year data --Volume --Last Trade Price
SALAMA
Price Change
Begin High Low End Value %
49.5 66.25 32.8 46 -3.5 (7.07)
* One year data --Volume --Last Trade Price
SABB Takaful
Price Change
Begin High Low End Value %
36.7 51.75 30 46.4 9.7 26.43
* One year data --Volume --Last Trade Price

8. TIMMINT Market Intelligence KSA Insurance Weekly Report 09 to 15 May, 2014
8
SAICO
Price Change
Begin High Low End Value %
#N/A #N/A #N/A #N/A #N/A #N/A
* One year data --Volume --Last Trade Price
ATC
Price Change
Begin High Low End Value %
#N/A #N/A #N/A #N/A #N/A #N/A
* One year data --Volume --Last Trade Price
Gulf Union
Price Change
Begin High Low End Value %
25.5 34.3 21.2 29.9 4.4 17.25
* One year data --Volume --Last Trade Price
SANAD
Price Change
Begin High Low End Value %
27.5 33.5 17.9 22.05 -5.45 (19.82)
* One year data --Volume --Last Trade Price
Allianz SF
Price Change
Begin High Low End Value %
75.25 96.75 58 65.5 -9.75 (12.96)
* One year data --Volume --Last Trade Price
Trade Union
Price Change
Begin High Low End Value %
24.7 31.1 19 30.2 5.5 22.27
* One year data --Volume --Last Trade Price
Sagr Insurance
Price Change
Begin High Low End Value %
25.4 42.6 21.55 41.6 16.2 63.78
* One year data --Volume --Last Trade Price
WAFA Insurance
Price Change
Begin High Low End Value %
135 179.75 54.75 98.25 -36.75 (27.22)
* One year data --Volume --Last Trade Price

9. TIMMINT Market Intelligence KSA Insurance Weekly Report 09 to 15 May, 2014
9
AICC
Price Change
Begin High Low End Value %
29.8 30.5 19.5 24.05 -5.75 (19.30)
* One year data --Volume --Last Trade Price
Walaa Insurance
Price Change
Begin High Low End Value %
28.3 34.7 22.9 32.2 3.9 13.78
* One year data --Volume --Last Trade Price
Saudi Re
Price Change
Begin High Low End Value %
10.8 14.15 9.45 13.55 2.75 25.46
* One year data --Volume --Last Trade Price
Bupa Arabia
Price Change
Begin High Low End Value %
28.6 97 27 91.5 62.9 219.93
* One year data --Volume --Last Trade Price
UCA
Price Change
Begin High Low End Value %
35.6 37.1 20.6 28.5 -7.1 (19.94)
* One year data --Volume --Last Trade Price
Al-Ahlia
Price Change
Begin High Low End Value %
50 80.25 39 59.25 9.25 18.50
* One year data --Volume --Last Trade Price
ACIG
Price Change
Begin High Low End Value %
37 41.9 24.4 30.3 -6.7 (18.11)
* One year data --Volume --Last Trade Price
AlRajhi Takaful
Price Change
Begin High Low End Value %
51.5 54.75 38 49.4 -2.1 (4.08)
* One year data --Volume --Last Trade Price

10. TIMMINT Market Intelligence KSA Insurance Weekly Report 09 to 15 May, 2014
10
ACE
Price Change
Begin High Low End Value %
65.5 77 55.25 77 11.5 17.56
* One year data --Volume --Last Trade Price
Al Alamiya
Price Change
Begin High Low End Value %
54 104 42.4 99.25 45.25 83.80
* One year data --Volume --Last Trade Price
AXA Cooperative
Price Change
Begin High Low End Value %
43.5 55.5 33.1 48 4.5 10.34
* One year data --Volume --Last Trade Price
Gulf General
Price Change
Begin High Low End Value %
#N/A #N/A #N/A #N/A #N/A #N/A
* One year data --Volume --Last Trade Price
Weqaya Takaful
Price Change
Begin High Low End Value %
35.5 37.3 24.15 24.9 -10.6 (29.86)
* One year data --Volume --Last Trade Price
Buruj
Price Change
Begin High Low End Value %
46.4 61.5 41.2 56 9.6 20.69
* One year data --Volume --Last Trade Price
Wataniya
Price Change
Begin High Low End Value %
#N/A #N/A #N/A #N/A #N/A #N/A
* One year data --Volume --Last Trade Price
AMANA Insurance
Price Change
Begin High Low End Value %
37.3 48.5 30.3 38.5 1.2 3.22
* One year data --Volume --Last Trade Price

11. TIMMINT Market Intelligence KSA Insurance Weekly Report 09 to 15 May, 2014
11
Solidarity
Price Change
Begin High Low End Value %
27.8 29.8 22.1 26.2 -1.6 (5.76)
* One year data --Volume --Last Trade Price
Enaya
Price Change
Begin High Low End Value %
40.7 51.25 33 46.4 5.7 14.00
* One year data --Volume --Last Trade Price
Alinma Tokio M
Price Change
Begin High Low End Value %
#N/A #N/A #N/A #N/A #N/A #N/A
* One year data --Volume --Last Trade Price
Jazira Takaful
Price Change
Begin High Low End Value %
11 72.5 11 59.75 48.75 443.18
* 3 months data --Volume --Last Trade Price
ANB Insurance
Price Change
Begin High Low End Value %
11 87.5 11 75.75 64.75 588.64
* 3 month data --Volume --Last Trade Price

12. TIMMINT Market Intelligence KSA Insurance Weekly Report 09 to 15 May, 2014
12
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