Malath Insurance CEO says able to offset losses by next year

Malath Cooperative Insurance and Reinsurance (Malath) will offset its accumulated losses by next year, if it manages to maintain its current growth level, CNBC Arabiya reported, citing Nasser Hashem Al Bunni, CEO of the company.

The insurer improved its financial performance in the first half of 2015 due to lower operating expenses and strong insurance activities, he said. However, despite swinging to profit in Q2-15, it couldn’t offset the losses incurred during the first quarter of 2015.

Malath has a clean balance sheet and only SAR 86 million worth of liabilities. With a five percent market share, the insurer has set aside SAR 55 million in provisions against NPLs, he added.

Saudi-based Malath recorded SAR 1 billion in written premiums in H1, rising 80 percent year-on-year, of which automobile insurance accounted for 80 percent, general insurance was 11 percent and healthcare at seven percent.

A capital hike is one of Malath’s options to buoy financial solvency, Al Bunni added. 

The insurer, which has SAR 200 million worth of portfolio investments in the Saudi market, is also looking to upgrade its infrastructure.

Over the six-month period of 2015, Malath narrowed losses before zakat by 54 percent to SAR 7.8 million, compared to the SAR 16.8 million a year earlier, according to data compiled by Argaam.