Salama Insurance profit sinks 36% to SAR 27.4M profit in 9M 2024, Q3 at SAR 5.9M

Salama Cooperative Insurance Co.’s profits dipped 36% to SAR 27.4 million in the first nine months of 2024 from SAR 43 million in the prior-year period.

The 9M 2024’s profits were hurt by an 8.94% year-on-year (YoY) decline in revenues to SAR 542.9 million, mainly due to decreased total written premiums for the vehicle insurance business.

Salama reported a decrease in insurance services, recording a loss of SAR 73.269 million compared to a profit of SAR 65.362 million in the first nine months of 2023.

The company set aside an additional reserve of SAR 140 million for incurred but not reported claims as of Sept. 30, 2024, with a net financial impact of SAR 1.5 million after reinsurance.

This reserve is related to the initial assessment of losses from the fire incident at the Jeddah International Market in the Al-Rawdah District, previously announced on the Tadawul website on Oct. 7, 2024, based on the preliminary loss assessment report from the appointed loss adjuster.

Salama registered a 17.06% YoY decline in net insurance profit, amounting to SAR 31.05 million, due to lower insurance services for the motor insurance segment.

The total gross written premiums (GWPs) dropped 30.7% YoY to SAR 407.3 million.

Meanwhile, Salama's investment portfolio experienced growth, resulting in an 18.36% increase in net profit from investment results, amounting to SAR 19.9 million during the nine-month period. This growth was driven by a higher investment portfolio volume and improved portfolio performance.

The third-quarter net profit fell 53.5% to SAR 5.9 million from SAR 12.67 million in Q3 2023.

Sequentially, net profit sank 48.5% from SAR 11.43 million in Q2 2024.

Shareholders’ equity, no minority interest, increased to SAR 232.3 million as of Sept. 30, 2024, compared to SAR 103.8 million a year earlier.

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