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Emirates Insurance
Report of the Board of Directors for the nine months ended 30 September 2022
The Board of Directors takes pleasure in presenting the unaudited results for the first nine months of 2022.
AED '000
Income Statement Sep-22 Sep-21
Gross premium Income 937,744 881,133
Net Earned Premium 258,391 334,051
Net Commission (14,590) (31,589)
Net Incurred and Paid Claims (149,150) (203,574)
Net Underwriting Income 104,651 98,888
Investment Income 8,397 51,773
Total Income 113,048 150,661
Operating Expenses (74,558) (79,306)
Other Expenses (12,124) (7,032)
Net Profit for the period ____ 26,366 64,323
Ratios
Earnings per share (Fils) 0.18 0.43
AED '000
Balance Sheet Sep-22 Dec-21
Shareholders' Equity 1,087,376 1,172,755
Total Assets 2,875,525 2,966,202
Management Commentary Q3 2022
EIC recorded a 6.4% increase in Gross Written Premium for the ls! nine months of the year compared to
Q3_2021-a good overall growth given the poor trading conditions in the motor market and overall
challenging marketplace.
Motor and medical insurance continue to produce challenges for the UAE insurance market and right sizing
EIC's portfolios continues to be a priority given the hostile pricing and claims environment. The negative
impact from our motor and medical insurance business has been mitigated by the strong performance in
our domestic fire and casualty business as well as our international business, enabling us to achieve a 27%
reduction in overall claims expenses. This has resulted in a loss ratio of 56%, 5% lower than Q3_2021.
These factors have contributed to a 6% increase in our net underwriting result before expenses as
compared to last year.
Our administrative cost reduced by 6% despite an increase in turnover. The increase in other expenses is
due to one off staff right sizing exercise earlier this year.
Past experience indicates that our underwriting performance normally improves in the fourth quarter and
we expect the same with continued improvement in our claims and expense ratios as well as beneficial
movement in our Unearned Premium reserves.
Investment Performance:
EIC posted a P&L Investment income of AED 8.4m on a YTD basis compared to AED 51.8m over the same
period last year.
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Emirates Insurance Co. (PSC) Incorporated in Abu Dhabi by Law No. 6/82 | Paid-up Capital DH. 150,000,000 | Insurance Company Registration No. 2 eminsco.comEmirates Insurance
During the quarter, markets continued their downward trajectory due to increasing concerns related to
economicslowdown amidst monetary tightening with most central banks maintaining a hawkish stance.
MSCI World and MSCI EM index fell 6.5% and 12.5% respectively during Q3'22 bringing their YTD returns to
-25.4% & -27.7% respectively. At the same time, fixed income markets provided no relief to market
participants during the year with major indices in developed and emerging markets falling between 10% to
20%.
While EIC is not immune to such periods of extreme market dislocations given our relatively higher risk
appetite, our portfolio has demonstrated resilience from a capital preservation perspective relative to the
broader market. EIC's tilt towards regional equities coupled with some tactical rotations during the year to
mitigate market and interest rate risk contributed positively to our performance. As such, while our P&L
Income was hampered predominantly due to an unprecedented rise in treasury yields, our total portfolio
had a limited decline of 2.2%, outperforming the benchmark by 8.8%.
EIC continues to assess risk return trade-off across components of our portfolio in orderto target
allocations that are optimized towards the rapidly changing market dynamics. We maintain our cautious
stance citing additional volatility in the short-term and expect some level of mean reversion for enhanced
profitability over forthcoming fiscal years.
Net Profit
Our net profit for the period decreased from AED 64.3m at the end of September 2021 to AED 26.4m at the
end of September 2022. The drop in net profit is mainly attributable to the drop in the P&L investment
income.
Balance Sheet:
The Total Assets of the Company have decreased by AED 91m since December 2021 to AED 2.88 billion. The
main reason for the decrease in assets is due to the dividend payout, fall in investment valuations and decline
in reinsurance share of Outstanding Claims.
Shareholders Equity declined by 7.3% due to the 2021 declared dividend of AED 75m and fall in Other
Comprehensive Income Reserve.
Cash and Term deposits fell by AED 29m compared to 31 December 2021. Our liquidity, solvency and working
capital position remains very strong.
I am further pleased to report the both S&P Global and AM Best have reconfirmed our A- Rating.
ABDULLAH M. MAZfiUI
CHAIRMAN
14 November 2022
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Emirates Insurance Co. (PSC) Incorporated in Abu Dhabi by Law No. 6/82 | Paid-up Capital DH. 150,000,000 | Insurance Company Registration No. 2 eminsco.com

Sentiment: positive