RAK Insurance posts Dh5m second-quarter profit

The Abu-Dhabi listed insurer’s net insurance premium rose 66 per cent to Dh58.7 million from Dh35.4m.

Ras Al Khaimah National Insurance (RAK Insurance) has swung back into the black in the second quarter from a year-earlier loss.

The insurer, in which RAK Bank holds a 79 per cent stake, yesterday posted a Dh5 million profit, thanks to an increase in underwriting income.

It had posted a Dh9.3m loss in the same period last year.

Net underwriting profit reached Dh5.8m in the second quarter from a loss of Dh8.3m a year earlier.

The Abu-Dhabi listed insurer’s net insurance premium rose 66 per cent to Dh58.7m from Dh35.4m.

Sixty insurers in the UAE have been locked in a premium price war that has affected the profitability of some firms despite increases in gross premium.

Written premiums in the UAE rose 13.5 per cent annually to Dh33.5 billion last year, the Insurance Authority said this month.

Last year was the worst on record for UAE insurers in terms of underwriting performance because of “the fiercely competitive market for high-volume medical and motor lines”, the credit ratings agency Standard & Poor’s said in May.

To bolster insurance firms, the Insurance Authority in February introduced new rules that restrict how companies can invest their money and how much exposure they can have to a particular asset class.

The rules also require them to have an independent investment committee as well as a series of changes that strengthen corporate governance, compliance and risk management.

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