Abu Dhabi, May 10th,2008(WAM)-- Al Khazna Insurance Company announced on Saturday it has acquired a 15 per cent stake in Saudi Arabia's Sanad for Co-operative Insurance and Reinsurance.
The deal is includes nearly three million shares, which allows Al Khazna to have two members in Sanad's board of directors. The representatives are Ahmad Mohammad al Rumaithi and Hamad Jassem Darwish. Additionally, Mohammad Jassem, Al Khazan's director general, would serve as a member in Sanad's executive administration. Mr Al Rumaithi said that Sanad is preparing to offer new insurance covers in the Saudi Market. "This is aimed at supporting the insurance sector in the kingdom and meeting the need of our clients in different fields," said Mr Al Rumaithi. He added that the partnership was a strategic step which would clear the way for Al Khazna to enter promising insurance market services. Saudi Arabia has seen strong growth in the insurance industry, and that was made possible through making health insurance obligatory health to all expatriates. This type of insurance alone would serve seven million residents in the kingdom. The sector's growth was further boasted as the Saudi government introduced new regulations which made vehicles insurance mandatory. The steadily growing investments in different sectors have also contributed to the insurance market boom. According to Mr Rumaithi, Al Khazna will play a pivotal role in the Saudi insurance industry through partnership with Sanad. This will be manifested through attracting experienced and efficient human resources which would qualify the company to acquire a good share of the Saudi markets. "We will make all of Al Khazna's expertise available to Sanad, and through our presence in the board of directors we will help Sanad maximise the benefits of its shareholders," said Mr Rumaithi. Sanad for Co-operative Insurance and Reinsurance was created as a public company in last July with a capital of 200 million Saudi riyals, divided into 20 million shares. The company's shares are with a nominal value of 10 riyals each. The founders have subscribed for 12 million shares with a nominal value of 120 million riyals, and that constitutes 21.52 per cent of the company's capital, while 8 million shares, worth 80 million riyals, were publicly traded. The Riyadh-based company was enlisted in the Saudi stock market on June 21. In its first day of trading, the the company's share rose by 410 per cent, closing at 51 riyals. Saudi Arabian Monetary Agency have permitted Sanad to carry out welfare insurance activities throughout the kingdom. Sanad is slated to make available several welfare insurance and reinsurance products, in addition to related activities such as representation, agents and brokering in accordance with relevant Saudi laws and regulations. Experts estimate the total value of the insurance industry in Saudi Arabia at 7 billion riyals. The figure is expected to double to 15 billion by next year. The industry will total more than 30 billion riyals in the coming ten years, while the average insurance cover per capita will jump from 150 riyals to 450 riyals.Copyright Emirates News Agency (WAM) 2008.
