Logo of The Company for Cooperative Insurance (Tawuniya)
The insurance industry represents a key pillar in Saudi Arabia’s economy, but its growth prospects have not yet been fully leveraged, CNBC Arabia reported, citing Ammr K. Kurdi, Chief Financial Officer (CFO) at The Company for Cooperative Insurance (Tawuniya).
Many of the Vision 2030 projects, including NEOM, Qiddiya and the Red Sea, unlock new growth opportunities for the insurance providers in the Kingdom.
The insurance market depth is no more than 1.3-1.4%, Kurdi stated, adding that annual insurance spending per capita stood at SAR 1,200, with protection and saving insurance accounting for 4%. These are considered low rates compared to peers in economically developed regional and global countries.
Other factors include insurance awareness and spread of innovative insurance programs that fulfill the sector requirements in the Kingdom, which will have a role in boosting the sector’s scope and profitability.
Kurdi indicated that Tawuniya’s positive results were backed by expanding the medical insurance portfolio for new clientele and the adoption of a high-quality policy to overcome inflation rates and higher overheads in the wake of the COVID-19 outbreak over the last two years.
Tawuniya implemented smart insurance techniques, especially in the car insurance segment, using advanced supply/demand analysis tools to help the company outperform the market and adopt a risk-averse pricing policy.
Seasonality factors also played a key role in H1 2022, backed by the return of Hajj and Umrah activities to pre-pandemic levels.
Tawuniya’s strategy is based on multiple pillars, including enhancing the quality of services via customer satisfaction surveys, increasing policy renewal rates, using risk analysis as positive indicators to ensure the strategy’s long-term vision and expanding communications with clients.
The insurer reported a net profit of SAR 206.3 million for H1 2022, up 2% year-on-year (YoY) from SAR 202.8 million a year earlier, data compiled by Argaam showed.
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