Saudi Arabia – Insurance prices increase by more than 100%
Wednesday, 10 28 2015, Category: Insurance and Reinsurance, Country: Saudi Arabia
Insurance companies in Saudi Arabia face two challenges. First they are required to achieve profitability and sustainability. Second they have to provide insurance at low prices acceptable by the public. So what happened to insurance companies? They started posting losses recurrently until their cumulative losses exceeded 50% of capital which prompted them to reinject capital in order to avoid suspension from the stock exchange when losses reach 75% of capital. The many reasons behind this situation as explained by insurers are the “hugeness of claims” and abuse where claims exceed insurance revenues. So how could insurance companies continue? Insurers earn revenues in order to insure or reinsure but they face huge losses in light of very high death rates which are among the highest in the world. Accent where “Every hour on death approximately” and chaos in the streets affect the young generation who are main category implicated.
Source: Al Arabiya