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Takaful’s Q2 earnings fall on higher claims

Abu Dhabi National Takaful Company, or Takaful, profits dropped 24 per cent to Dh15 million during the quarter ended 30 June, 2014, due to higher claims.

In addition, Takaful realised an underwriting profit of Dh10.6 million for the period compared to Dh16.4 million in the same period last year.

Gross Takaful contributions grew to Dh158.2 million compared to Dh124.5 million. However, net claims more than doubled to Dh26 million compared to Dh12 million in the April-June ended period, bringing down the earnings.

Total cash and bank balances for the period were lower at Dh155.6 million compared to Dh187.6 million for the year ended 31 December 2013.

Commenting on the results, Khadem Al Qubaisi chairman of Abu Dhabi National Takaful Company, said: “Despite of the fierce competition, Abu Dhabi National Takaful remains in the quest for excellence constant at all levels. With this in mind, I am pleased to announce that the company is in the process of obtaining an international financial rating.”

Osama Abdeen, chief executive officer of Abu Dhabi National Takaful, said: “Abu Dhabi National Takaful reported a profit of Dh15 million for the period ended 30 June 2014 compared to Dh19.8 million for the corresponding period of 2013, representing a decrease of 24 per cent. The decrease in net profit is mainly due to the increase in net claims incurred in the motor line of business. This has resulted in an adverse impact on the profitability of our motor portfolio and also attributable to the prevailing intense competition on prices in respect of all lines of business.”

He said that despite the continuity of low technical prices in the UAE insurance market, the company achieved an underwriting profit of Dh10.6 million by implementing its sound underwriting policy.

“We, are keen on maintaining the trust of our shareholders and customers in the UAE and our commitment to provide to our customers the best Shariah compliant insurance experience with competitive services and benefits,” he said.

— haseeb@khaleejtimes.com