timmint mi - uae insurance weekly report (issue 2014-19)
TRANSCRIPT
TIMMINT Market Intelligence UAE Insurance Weekly Report 02 to 08 May, 2014
2
From:
TIMMINT
Market Intelligence
To:
Whom it may concern
Subject:
Weekly Status Report, UAE
Insurance Industry.
Issue Year 2014, Week 19
Report Sections Page
UAE INSURANCE
NEWS 2
ABU DHABI
INSURANCE INDEX 5
DUBAI INSURANCE
INDEX 6
ABU DHABI MARKET
PERFORMANCE 7
DUBAI MARKET
PERFORMANCE 9
Who We Are Visit our website www.timmint.com
Disclaimer:
This report was prepared as an
account of work sponsored by the
Company. Certain information has
been obtained from published
sources and is given as of the dates
specified. All the information in this
publication is verified to the best of
the authors’ and publisher’s ability,
but neither the company nor the
Management Team makes any
warranty, express or implied, or
assumes any legal liability or
responsibility for the accuracy
completeness or the results of such
use of the information. All such
information is subject to change
without notice.
UAE INSURANCE NEWS
Dubai shows the way in health care
DHA is all set to help the emirate enter a new era of medical facilities and protection, making
them more credible, modern and accessible than before
To date, health care costs across the Gulf Cooperation Council (GCC) have been covered by
various governments. However, they are increasingly recognizing that they will not be able to
fund their citizens’ health care needs indefinitely and are looking at new ways of covering the
costs.
The Dubai Health Authority (DHA) has made progress on this front last
month, bringing significant and much-needed health care reforms to the
emirate. The DHA estimates that there are only one million people in Dubai
with health insurance, leaving around two million people not covered and
lacking access to even basic health care facilities.
Need of change
In light of this, change was needed and the DHA announced earlier this year a new directive for
compulsory health insurance for both residents of, and visitors to, the emirate. Under this new
framework, all residents of Dubai must be provided with at least a basic level of health
insurance by their employers and new visa applications will also require this as part of the entry
criteria.
While ensuring a positive step in protecting the health of the nation and the most vulnerable,
the new system will undoubtedly bring challenges to all parties involved. The government will
need to secure stakeholder support and understanding at many levels to ensure the
infrastructure for the transition is in place; insurance providers will need to have a consolidation
strategy ready; employers will need to look at ways to manage the new health care cost within
its organisation and be well-equipped to respond to claims; and regulators will need to look at
how the model is scalable across the region to address the health care burden at the GCC level.
New era of healthcare
In this move, Dubai aims to go from a partly insured to a 100 per cent insured society. The new
law is also an integral part of DHA’s vision and strategy to grow Dubai into a quality health care
hub, with a strong legislation and medical system and excellent hospitals, doctors and of course
equipment.
Source: Gulf News
The TIMMINT Group is
specialized in providing
professional services to the
worldwide business
community.
1 million covered
2 million uncovered
With its increasing focus on quality medicine — as well as the system to provide it —
DHA is set to make Dubai enter a new era of health care, making it more credible,
modern and accessible than ever before. The new regulations will be rolled out over the
next 18 months in several phases, with everyone entitled to at least a basic package of
cover, which must include emergency services, access to a general physician, referral to
specialists, tests and investigations, surgical procedures and maternity care.
TIMMINT Market Intelligence UAE Insurance Weekly Report 02 to 08 May, 2014
3
UAE Property/Casualty Insurance Sector Carries
Intermediate Industry and Country Risk Assessment, Says
S&P Report
Standard & Poor's Ratings Services has released further details regarding its insurance
industry and country risk assessment (IICRA) for the United Arab Emirates (UAE)
property/casualty (P/C) insurance sector (see "United Arab Emirates Property/Casualty
Insurance Sector Carries Intermediate Industry and Country Risk Assessment").
We assess industry and country risk for the UAE P/C sector as intermediate. Our assessment
reflects the risks typically faced by P/C insurers operating in the UAE, and is derived from our
view of moderate UAE country risk plus intermediate industry risk prevailing
for insurers of P/C lines of business in the country.
We assess the UAE country risk as moderate. This reflects the country's
economic risk trend, political risk, and financial system risk.
Under Standard & Poor's policies, only a Rating Committee can determine a Credit Rating Action
(including a Credit Rating change, affirmation or withdrawal, Rating Outlook change, or
CreditWatch action). This commentary and its subject matter have not been the subject of
Rating Committee action and should not be interpreted as a change to, or affirmation of, a
Credit Rating or Rating Outlook.
Source: Zawya
We assess the industry risk for the UAE P/C insurance market as intermediate, based on an
evaluation of five industry-related sub-factors. We see product risk as positive; profitability
(measured by return on equity), barriers to entry, and market growth as neutral; and the
institutional framework as weak.
Risk in UAE:
moderate
TIMMINT Market Intelligence UAE Insurance Weekly Report 02 to 08 May, 2014
4
UAE insolvency ratio lower than in Western Europe
The real insolvency ratio in the UAE is about 5-10 per cent, which is lower than most of the
developed Western European countries, according to an executive of a global credit insurance
company.
Massimo Falcioni, CEO of Euler Hermes for GCC, said insolvency claims ratio is “around 37 per
cent… but insolvency claims does not mean that they are not paying. It means there is a delay in
payment. Real insolvency is 5-10 per cent.”
According to Creditreform Economic Research Unit, insolvency in France was 28.3 per cent,
followed by 17.3 per cent in Germany, 11.4 per cent in Scandinavia and 10.6 per cent in Britain
in 2011-12.
Falcioni said this delay in payment is impacting companies because their working capital
waiting for payment gets hit. And this delay is rising especially in Saudi and UAE because
many companies in the UAE are trading outside the country in regions like Europe, where
there is a prolonged recession, Brazil and African countries.
Euler Hermes is a credit insurance company that offers bonding, guarantees and collections
services for the management of business-to-business trade receivables. Euler Hermes claims to
have a 50 per cent market share of credit insurance in the GCC.
Commenting on the impact of insolvency on Euler Hermes, Falcioni said: “Properly managed risk
will not impact our business… We have a lot of information that we gather in the field by
meeting customers before we give credit. We give credit only to those who merit for which we
have transparency of information so that we can assess and calculate the probability of default.”
He said construction and building material companies are the most sensitive with regards to
insolvency. “Risk is everywhere. There are no risk-free sectors; all the sectors are sensitive but
building materials companies’ margins are very low and competition is very strong.”
Debt collection
Commenting on debt collection, Euler Hermes CEO for GCC Falcioni said debt collection in the
region in the past year was quite difficult because some of the companies which went bankrupt
ran away from the UAE.
He said the debt collection is done not only in the region but also outside because of the nature
of the companies’ work as they are involved in trade and exports.
There are much more over dues registered so delay in payments is increasing, he said, adding
that thanks to the services of experts like Credit Insurance, this kind of issue is manageable.
Source: Emirates 24/7
Insolvency in France:
28.3%
Insolvency in Germany:
17.3%
Insolvency in Scandinavia:
11.4%
Insolvency in Britain:
10.6%
UAE Real Insolvency
ratio
5-10%
TIMMINT Market Intelligence UAE Insurance Weekly Report 02 to 08 May, 2014
5
ABU DHABI INSURANCE INDEX
Insurance Sector Performance:
The chart for Abu Dhabi Insurance Index illustrates the global performance of all Abu Dhabi insurance companies in the stock market for a period of one year, showing a year to date change of (5.57%)
Insurance Index - Year to Date Figures
Index as of 31 Dec Current Index YTD Change Indicator % Change
2,309.06 2,437.67 128.61
5.57%
Insurance Index (one year)
--- Abu Dhabi Insurance Index (ADII)
Insurance Index (last month)
--- Abu Dhabi Insurance Index (ADII)
AD Insurance vs. General Index (one year - %)
--- Abu Dhabi Insurance Index (ADII)
--- Abu Dhabi Index (ADI)
AD Insurance vs. General Index (last month - %)
--- Abu Dhabi Insurance Index (ADII)
--- Abu Dhabi Index (ADI)
TIMMINT Market Intelligence UAE Insurance Weekly Report 02 to 08 May, 2014
6
DUBAI INSURANCE INDEX Insurance Sector Performance:
The chart for Dubai Insurance Index illustrate the global performance of all Dubai insurance companies in the stock market for a period of one year, showing a year to date change of (0%)
Insurance Index - Year to Date Figures
Index as of 31 Dec Current Index YTD Change Indicator % Change
2,402.31 2,503.77 101.46
0%
Insurance Index (one year)
Insurance Index (last month)
DFM Index (one year)
DFM Index (last month)
Insurance Index - 52 Weeks Price
High Date Low Date Current Price
2,787.53 21/1/2014 1,950.00 8/9/2013 2,503.77
TIMMINT Market Intelligence UAE Insurance Weekly Report 02 to 08 May, 2014
7
ABU DHABI MARKET PERFORMANCE
The table hereunder reflects the performance of the 17 listed insurance companies in Abu Dhabi stock market during the week:
Companies Previous Closing
Close High Low Price Change No. of
Trades Volume Value
Value %
Abu Dhabi National Takaful Co. PJSC 7.20 - - - - - - - -
Abu Dhabi National Insurance Co. 7.00 6.30 6.30 6.30 (0.70) (10.0) 1 30,000 189,000
Al Ain Al Ahlia Insurance Co. 45.00 - - - - - - - -
Al Buhaira National Insurance Company 2.85 - - - - - - - -
Al Dhafra Insurance Co. 6.50 - - - - - - - -
Al Khazna Insurance Co. 0.87 0.80 0.80 0.80 (0.07) (8.05) 1 1,585 1,268
Al Wathba National Insurance Co. 5.35 - - - - - - - -
Emirates Insurance Co. 8.00 - - - - - - - -
Fujairah National Insurance Co. 300.00 - - - - - - - -
Green Crescent Insurance Company 1.20 1.11 1.17 1.06 - - 12 135,723 154,965
Insurance House P.S.C 1.40 - - - - - - - -
Methaq Takaful Insurance Co. 1.48 1.43 1.55 1.40 0.05 3.38 186 6,033,261 8,920,501
National Takaful Company 1.23 1.14 1.14 1.12 0.02 1.79 4 135,169 152,689
Ras Al-Khaimah National Insurance 3.18 - - - - - - - -
Sharjah Insurance Company 4.05 - - - - - - - -
Union Insurance Company 1.05 1.10 1.10 1.10 0.05 4.76 1 26,216 28,838
United Insurance Co. 2.00 - - - - - - - -
This chart shows the companies that had the highest
increase in % of change in the stock price over the week
This chart shows the companies that had the highest
volume over the last week.
4.76
3.38
1.79
Union Insurance Company Methaq Takaful InsuranceCo.
National Takaful Company
% change in price
MethaqTakaful
InsuranceCo.
GreenCrescentInsuranceCompany
NationalTakaful
Company
Abu DhabiNational
InsuranceCo.
UnionInsuranceCompany
6,033
136 135 30 26
Top 5 Most Active by Volume (last week)
TIMMINT Market Intelligence UAE Insurance Weekly Report 02 to 08 May, 2014
8
The chart below shows the positioning of the insurance
sector among the other sectors in Abu Dhabi Financial
Market
By volume
The chart below shows the positioning of the insurance
sector among the other sectors in Abu Dhabi Financial
Market
By value
Banks 3%
Real Estate 35%
Telecom 1%
Industrial 1%
Insurance 0%
Energy 7%
Investment & financial
services 53%
Banks 7%
Real Estate 34%
Telecom 2%
Industrial 0%
Insurance 0%
Energy 2%
Investment & financial
services 54%
TIMMINT Market Intelligence UAE Insurance Weekly Report 02 to 08 May, 2014
9
DUBAI MARKET PERFORMANCE
The table hereunder reflects the performance of the 13 listed insurance companies in Dubai stock market during the week:
Companies Previous Closing
Close High Low Price Change No. of
Trades Volume Value
Value %
Al Sagr National Insurance Company - - - - - - - - -
Alliance Insurance - - - - - - - - -
Arab Insurance Group P.S.C. 1.70 - 1.70 - - - 2.00 4,307 7,276
Arabian Scandinavian Insurance - - - - - - - - -
Dubai Insurance Co , PSC - - - - - - - - -
Dubai Islamic Insurance and Reinsurance
Co.
1.17 1.16 1.24
1.13
0.01 0.85 256.00 10,739,081 12,651,982
Dubai National Insurance & Reinsurance 3.60 - 3.60 - 0.35 9.72 7.00 51,601 169,157
Islamic Arab Insurance Company 1.10 1.13 1.23
1.10
0.03 2.73 1,544.00 127,607,502 149,241,846
National General Insurance Company PSC - - - - - - - - -
Oman Insurance Company (P.S.C.) - - - - - - - - -
ORIENT Insurance PJSC - - - - - - - - -
Takaful Emarat (PSC) 1.14 1.14 1.23
1.02
- - 463.00 21,096,940 23,938,960
Takaful House 1.08 1.07 1.14
1.02
0.01 0.93 295.00 11,197,075 12,068,306
This chart shows the percentage change in price of Dubai
insurance companies over the last week.
This chart shows the top insurance companies that were
the most active by volume over the last week.
9.72
2.73
0.93 0.85 0
Dubai NationalInsurance &Reinsurance
Islamic ArabInsuranceCompany
Takaful House Dubai IslamicInsurance andReinsurance
Co.
Takaful Emarat(PSC)
% change in price
Islamic ArabInsuranceCompany
Takaful Emarat(PSC)
Takaful House Dubai IslamicInsurance andReinsurance
Co.
Dubai NationalInsurance &Reinsurance
127,608
21,097 11,197 10,739
52
Top 5 Most Active by Volume (last week)
TIMMINT Market Intelligence UAE Insurance Weekly Report 02 to 08 May, 2014
10
The chart below shows the positioning of the insurance
sector among the other sectors in Dubai Financial Market
By volume
The chart below shows the positioning of the insurance
sector among the other sectors in Dubai Financial Market
By value
Banks 23%
Insurance 6%
Invest. & Fin. Services
10%
Real Estate &
Construction 40%
Services 1%
Telecommunication
1%
Transportation
20%
Banks 20%
Insurance 2%
Invest. & Fin. Services
11% Real Estate
& Construction
56%
Services 1%
Telecommunication
2%
Transportation 9%
TIMMINT Market Intelligence UAE Insurance Weekly Report 02 to 08 May, 2014
11
Office – LEBANON
Scan the
QR code
for our
contact
details