Saudi insurance to remain profitable in 2018
Tuesday, 04 24 2018, Category: Insurance and Reinsurance, Country: Saudi Arabia
Saudi Arabia’s insurance sector is expected to remain profitable this year driven by growth prospects in the medium term and overall improving capital levels, S&P Global Ratings said in a recent report.
The agency cited the efforts of the local authorities to tackle the large number of uninsured drivers, the arrival of women drivers in mid-2018, and the introduction of additional benefits under the unified medical policy from July 1, as the key supports for further premium growth over the medium term.
“We also believe the local regulator (SAMA) will remain committed to maintaining marker discipline by introducing more sophisticated risk-based regulations,” S&P said.
This, however, could mean that going forward there may be fewer insurers in the market, but they will be more profitable, it added.
On the other hand, foreign workers’ exit from the Kingdom could result in downward pressure in 2018, S&P said.
The agency said that the pressures on insurance firms to reduce motor rates – combined with the risk of pricing additional medical benefits without historic date – could lead to lower earnings this year.
Meanwhile, in 2017, the net income for the whole i