AM best affirms credit ratings of Al-Sagr national insurance company p.s.c..

The ratings reflect ASNIC's balance sheet strength, which AM Best categorises as very strong, as well as its adequate operating performance, limited business profile and marginal enterprise risk management.


LONDON:—AM Best has affirmed the Financial Strength Rating of B+ (Good) and the Long-Term Issuer Credit Rating of “bbb-” of Al-Sagr National Insurance Company P.S.C. (ASNIC) (United Arab Emirates). The outlook of these Credit Ratings (ratings) is stable.

The ratings reflect ASNIC’s balance sheet strength, which AM Best categorises as very strong, as well as its adequate operating performance, limited business profile and marginal enterprise risk management.

ASNIC’s balance sheet strength is underpinned by the company’s risk-adjusted capitalisation at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR). Offsetting rating factors include the high concentration of the company’s investment portfolio in volatile domestic real estate and equity assets. In addition, the company suffers from poor cash collection from a variety of debtors (including reinsurers and related parties). ASNIC’s liquidity position continues to require support from its overdraft facilities; however, the company has actively reduced its debt in recent years.

ASNIC’s historical operating performance has been subject to volatility, with fluctuations arising from both technical and non-technical activities. This translated to a marginal five-year average (2014-2018) return on equity of -0.2%. The company registered a net profit of AED 21.7 million (2017: AED 20.1 million) in 2018. This was driven by improved underwriting performance, with a loss ratio of 88.3% (2017: 89.6%), stemming from enhanced risk selection and underwriting discipline, which offset weaker investment returns. Whilst results for the first half of 2019 indicate a continued focus on technical profitability, the continued high level of overdue receivables on the company’s balance sheet could lead to material negative adjustments to net profits in the medium term.  

ASNIC has a modest business profile as a mid-tiered insurer in the United Arab Emirates market, generating gross written premiums of AED 355.7 million in 2018. Despite some product diversification by line of business, the company’s primary focus is on the motor and medical lines of business.


This press release relates to Credit Ratings that have been published on AM Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Understanding Best’s Credit Ratings. For information on the proper media use of Best’s Credit Ratings and AM Best press releases, please view Guide for Media - Proper Use of Best’s Credit Ratings and AM Best Rating Action Press Releases.

AM Best is a global credit rating agency and information provider with an exclusive focus on the insurance industry. Visit  for more information.

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