Insurance House has earned a robust net profit of Dh9.56 million for the financial year ended on December 31, 2013, which is 26.7 per cent higher than the net profit of Dh7.54 million earned during the maiden financial year ended 31 December 2012, comprising of 20 months and 20 days.
Total comprehensive Profit for the 12 months ended December 31, 2013 was Dh14.38 million, which is more than double the Total comprehensive profit of Dh6.79 million registered during the previous reporting period.
Commenting on the results of the company for the second full year of operations, Mohammed Alqubaisi, Chairman Insurance House said: “We are delighted and encouraged with this remarkable performance by our young enterprise, operating in the fiercely competitive UAE insurance sector. It reaffirms our belief that product innovation and superior customer service are the key ingredients of profitable future growth. This is an evidence of the importance of investing in qualified human resources.”
Gross Premiums Written (GPW) during the 12 month period ended December 31, 2013 totaled Dh99.13 million, which is 26.5 per cent higher than the Gross Premiums Written during the previous reporting period ended 31 December 2012.
Net earned premiums aggregated to Dh66.21 million, reflecting a growth of 54.2 per cent over the previous reporting period. Net Earned Premiums as a percentage of GPW improved to 66.8 per cent compared to 54.8 per cent in the previous period.
Net Underwriting Profit for 2013, after deducting Operating expenses was Dh11.38 million, which is 34.3 per cent higher than the Net Underwriting Profit of Dh8.47 million registered during the previous reporting period. Net Underwriting Profit as a percentage of GPW improved to 11.5 per cent compared to 10.8 per cent in the previous reporting period.
Underwriting Profit from core insurance activities was complemented by robust and sustainable income generated from the well diversified proprietary investment portfolio. For the 12 months ended 31 December 2013, income from investing activities amounted to Dh18.98 million compared to Dh13.59 million for the previous reporting period, on an annualized basis. “Since inception, IH’s Investment Strategy continues to be well thought out, clearly documented and professionally managed,” Alqubaisi stated.
Total assets as of December 31, 2013 doubled to Dh254.61 million compared to Dh125.8 million as of 11 April 2011, being the date on which we commenced operations. During the year, total Shareholders’ Equity strengthened to Dh140.27 million as of 31 December 2013, compared to Dh126.68 million as of 31 December 2012.
The company maintains a conservative approach to liquidity management. Cash and cash equivalents as at December 31, 2013 stood at Dh24.94 million compared to Dh17.21 million as at the end of the previous reporting period.
General and administrative expenses for the 12 months ended 31 December 2013 were Dh20.79 million compared to Dh24.38 million during the previous reporting period covering 20 months and 20 days.
Ahmad Idris, CEO of Insurance House, said: “IH operating cost model is designed to be efficient and rapidly scalable in line with business growth. This is reasonable for a full-fledged insurance operation covering our Abu Dhabi headquarters and 4 operational branches located in Dubai, Sharjah, Al Samha and Mussafah.”
“In this regard, 12.5 per cent of the company’s current work force comprises of UAE nationals, manifesting our strong commitment to the development of UAE nationals in the insurance sector. This is ahead of the minimum requirement for employment of UAE nationals currently mandated by the UAE Insurance Authority for the year 2013,” continued Idris.
Bearing in mind the need to invest for accelerated growth in the near term, the Board has not recommended any dividend payment. In 2013, the Company obtained necessary regulatory approvals to undertake a share buy-back program. The Company maintains that the share buyback initiative is in the best interests of its shareholders and is intended to enhance shareholders value.
“Since inception, Insurance House has crossed several major milestones at a rapid pace. We have invested in the right people, processes and systems and have built a solid foundation for sustainable future growth. We look forward to 2014 with optimism and have accordingly set ambitious business growth targets. Our strategy is sound and is backed by a robust infrastructure that is geared to deliver profitable growth and maximized returns to our shareholders,” concluded Idris.