Arig upbeat despite industry challenges
Manama, May 13, 2011
Arab Insurance Group (Arig) remained in positive territory in the first quarter despite a difficult industry climate, returning a profit of $600,000 compared to $4.5 million during the corresponding period in 2010.
According to experts, global reinsurance markets took a big hit during the first quarter when severe earthquakes in Japan and New Zealand as well as floods in Australia caused multi-billion-dollar losses to the industry.
Lower investment returns were not providing much relief to the insurance industry.
In the Middle East, recurring flood losses from Saudi Arabia and generally lagging economic performance due to the Arab unrest hit the insurance firms badly.
Arig's quarterly result reflects the difficult industry climate, but remained in positive territory, returning a profit of $600,000 compared to $4.5 million in the first quarter of 2010, said a senior official.
At the same time, technical provisions were strengthened against unreported future claims from clients, the official adde.
Mixed financial markets generated investment income of $5.5 million against $6.5 million for the comparative period in 2010.
Starting this year, Arig's corporate membership at Lloyd's of London became operational, producing complementary income for the group from territories outside the Middle East and North Africa region.-TradeArabia News Service