Walaa Insurance says tough competition to weigh on motor sector, eyes higher market share: CEO

Johnson Varughese, CEO of Walaa Cooperative Insurance Co.

Walaa Cooperative Insurance Co. is heading to acquire a higher market share, which will positively reflect on gross written premiums and earned premiums. It is working on a plan to slash general and administrative expenses, and realize better profit from investments, CEO Johnson Varughese told Argaam in a phone call.

The company has discontinued some of the accounts with high losses to focus on selling the motor insurance product in areas with low level of accidents. The reason for the increase in motor claims was the unprecedented increase of motor accidents in most of the Kingdom’s cities.

Motor sales decreased by 25% in Q3 2022 compared to the same period last year, Varughese explained, adding this decrease was taken as a corrective action for the portfolio toward not participating in tough competitions for individual motor insurance, where most of the companies are competing massively. Accordingly, this will reflect negatively on motor insurance in the sector.

Moreover, he attributed the increase in other underwriting income to the rise in the company’s profit share from selling Hajj and Umrah, as well as travel and COVID-19 products.

The company’s medical sales surged 115% year-on-year (YoY) in Q3 2022. The company is heading to acquire a higher market share in medical insurance convenient to the expected growth of this product according to the privatization of some entities and increase in population.  

Walaa Insurance’s market share in the motor sector reached 5%, 2% in medical insurance, 14% in general insurance, and 7% in protection and savings. 

The insurance services provider widened net losses to SAR 59.9 million in the first nine months of 2022, compared to SAR 57.6 million in the prior-year period, Argaam earlier reported.