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SNIC Insurance (SNIC), a leading Bahrain-domiciled insurance company, announced today its financial results for the year ended 31 December 2019.

The Company reported a fivefold increase in net profit for 2019 to BD 1.43 million compared with a net loss of BD 0.35million for the previous year, resulting primarily from an improved technical result and higher income from investments.

The underwriting result increased by 75% to BD 0.96 million from BD 0.55 million in 2018, underlining the success of corrective measures introduced by the Company over the past two years. This is reflected in net incurred claims reducing by 23.0% to BD 3.16 million from BD 4.13 million a year earlier, and the loss ratio improving to 58% from 70% in 2018. The Company’s conservative underwriting approach and strong risk management resulted in gross written premiums increased by1.0% to BD 10.39 million from BD 10.29 million in 2018; and net earned premiums dropping by 8.0% to BD 5.42 million from BD 5.88 million in the previous year. 

Net investment income grew by more than six fold to BD 1.74 million compared with BD 0.24 million in 2018.This improvement resulted from favorable global market conditions during the year; together with the improved profit generated from SNIC’s share in its Saudi-based associate company, Wataniya Insurance.

General and administrative expenses rose by 18% to BD 1.94 million from BD 1.64million in 2018. The increase is attributable to investment in a new state-of-the-art Tata Consultancy Services (TCS) BaNCScore insurance system, and recruitment of high-calibre staff with specialized competencies, through which to support ongoing implementation of the Company’s digital transformation strategy.

SNIC continued to maintain a strong balance sheet. As at 31 December 2019, total assets stood at BD 31.68 million, up by10% from BD 28.84 million at the end of 2018; while total shareholders’ equity had grown by 9% to BD 18.39millionfrom BD 16.88 million at the end of the previous year.

Commenting on these results, SNIC General Manager, Mr. Khalid Al-Shaikh, said: “We are very pleased with the Company’s financial performance, which met our expectations, despite very challenging market conditions. It is pleasing to note that our growth during the year was in line with the average growth recorded by the industry’s market leaders.

“Implementation of our new core system will facilitate the development and introduction of innovative new InsurTech digital solutions for retail and corporate clients during the year. These will further enhance the ‘customer experience’ and support the Company’s vision and strategy of ‘going beyond’”, he noted.  

In this respect, SNIC launched its Digital Employee Benefits Platform, which was developed totally by the Company, and is the first of its kind in the Kingdom of Bahrain. This fully automated platform provides a range of services including a convenient Medical E-Card; and the ability of HR departments and staff to access the national network of healthcare providers, review the table of benefits (TOB), and initiate and monitor the claims process. The resulting paperless workflow, fully integrated with third-party administrators (TPAs), supports the Central Bank of Bahrain’s digital initiatives for the insurance industry.

SNIC also launched its new Digital Employees’ Savings and Protection Plan (Ghady). This innovative and flexible plan will make it easier for staff to plan for their families’ current and future financial security, along with the benefits of wholesale pricing. 

Regarding this new solution, Mr. Al-Shaikh said: “Given the restricted talent pool in the GCC and the competition for high-calibre professionals, ‘quality of hire’ is a critical success factor for companies; and offering attractive employee benefits can serve as a key competitive differentiator. By signing up with SNIC for this new solution, our corporate clients will be able to attract, engage and retain talented and high-performing staff by offering a superior benefits package.”

Looking ahead, Mr. Al-Shaikh noted: “It is very difficult to determine the future outlook for our Company and the industry with any degree of certainty, due to the growing economic impact of the global COVID-19 pandemic. We applaud the proactive and concerted measures being taken by the Government of Bahrain to control the spread of the coronavirus, and God willing, the country will not be as badly affected as many others around the world.

“The insurance industry has an important role to play in assisting companies to weather the worst of the impact of COVID-19 and ensure their business continuity. SNIC is looking at the most appropriate solutions to support our clients during these challenging times, and we hope to release these sooner than expected,” he concluded.

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