As the insurance market in the Kingdom continued to perform against a backdrop of volatility which was visible during the first half of the year, Tawuniya successfully continued its growth momentum in 2022, recording one of our strongest performances to date.
In 2022, Tawuniya’s Gross Written Premium (GWP) reached SAR 14.3 Bn., a remarkable 40% growth year-on-year from 2021, and a record-setting achievement in the Company’s 36-year operating history. This accomplishment also cemented our position as the largest insurance company in the Kingdom in terms of GWP. More importantly, this performance resulted in strong profitability with earnings before taxes reaching SAR 480 Mn., a 37% growth compared to 2021.
All business lines showed impressive growth during the year under review, backed by market growth, increase in premium values, and value-added services differentiating our product offerings to our members, mainly in our health and mobility insurance lines. Tawuniya’s Health and Life GWP grew by 27% to SAR 9.9 Bn. with the recent expansion in the health insurance sector and its resulting market competition and pricing. The success of this business vertical attributed to 69% of our total GWP.
Our winning combination of utilizing emerging technologies and smart sales strategies contributed greatly towards an exceptional 68% growth in the Mobility business to surpass SAR 1 Bn. in 2022; where we deployed a dynamic pricing technologies, and launched a multitude of value-added services to enhance customer experience, which also led to a 50% increase in insured vehicles compared to 2021. Our General line of business recorded remarkable growth of 33% year-on-year, reflecting the market’s growing confidence in Tawuniya’s capabilities in underwriting complex and large policies. The Hajj and Umrah vertical regained its growth momentum by reaching SAR 1 Bn. in GWP, with the Kingdom fully opening up to pilgrims during the year.
In terms of assets, our total assets increased by 29% reaching SAR 18.4 Bn. driven by growth in our investment portfolio and written premiums for insurance. Furthermore, cash flow from operating activities during the year was recorded at a healthy inflow of SAR 1.2 Bn., while SAR 724 Mn. were directed towards investing activities. Our investment team maintained a robust return realization of SAR 304 Mn. despite the economic challenges, market fluctuation, and inflationary pressures witnessed during the year.
While the growth of the overall business also resulted in a 27% year-on-year jump in incurred claims to SAR 8.5 Bn. In 2022, we focused on effective claims management and underwriting practices, fraud reduction, and enhanced governance, which reduced our loss ratio by 4 percentage points to reach a healthy 80% in 2022. This commendable effort allowed us to grow our operating surplus by a 191% to reach SAR 226 Mn. Our spending efficiencies reduced our General and Administrative expenses ratio from 9.4% in 2021 to 8.9% in 2022, further supporting the bottom-line.
The strong underwriting performance throughout the reporting period and growth in investment income allowed us to secure SAR 480 Mn. in earnings before taxes and zakat in 2022, recording a growth of 37% from last year.
As a result of this remarkable performance, net income reached SAR 391 Mn., with the earnings per share (EPS) reaching at SAR 3.13 as of 31 December 2022, compared to SAR 2.13 from the previous reporting period.
Five-year Summary of Business Results
| Description | 2022 SAR’000 |
2021 SAR’000 |
2020 SAR’000 |
2019 SAR’000 |
2018 SAR’000 |
| Gross Written Premiums (GWP) | 14,349,620 | 10,218,606 | 9,061,768 | 8,375,860 | 7,641,245 |
| Net Earned Premiums (NEP) | 10,561,448 | 7,929,662 | 7,042,385 | 6,877,318 | 7,065,754 |
| Net Incurred Claims | 8,455,329 | 6,660,276 | 5,487,973 | 5,812,986 | 6,571,667 |
| Net Profit (Loss) before Zakat | 480,389 | 350,138 | 514,459 | 402,165 | (213,339) |
| Total Comprehensive Income | 326,078 | 329,702 | 309,673 | 691,468 | (318,160) |
| Total equity | 3,365,142 | 3,039,064 | 2,809,362 | 2,499,689 | 1,808,221 |
| Profit per share (SAR) | 3.13 | 2.13 | 3.15 | 2.62 | (2.23) |
Future Outlook
As per the regulations of the Saudi Central Bank, Tawuniya will adopt the IFRS 17 and IFRS 9 accounting standards, which will be applied from 01 January 2023. These standards will bring significant changes to the accounting for insurance and reinsurance contracts and financial instruments. Reporting under such standards will enhance the transparency and comparability of insurance financial statements globally.
We are excited about the continued economic development creating new insurable assets and new lines of mandatory coverage across the Kingdom, and we look forward to realizing our overarching strategic vision of strengthening our position as the leading insurer in the Kingdom of Saudi Arabia, and becoming the largest insurer in the MENA region.
Dr. Ammr K. Kurdi
Chief Financial Officer
Income Statement for 2022
| Description | Actual | LY | Actual vs |
| LY | |||
| Gross Written Premiums (GWP) | 14,350 | 10,219 | 40% |
| Net Written Premiums (NWP) | 12,165 | 8,608 | 41% |
| Net Earned Premiums (NEP) | 10,561 | 7,930 | 33% |
| Net Incurred Claims (NIC) | -8,455 | -6,660 | 27% |
| Contribution | 2,106 | 1,270 | 66% |
| Reinsurance commission | 136 | 132 | 3% |
| Policy Acquisition Cost (PAC) | -496 | -350 | 42% |
| Underwriting expense | -251 | -138 | 82% |
| Underwriting income | 12 | 6 | 100% |
| Insurance Companies Share distribution | -441 | -63 | – |
| Underwriting profit | 1,067 | 857 | 25% |
| General and administrative expense | -867 | -737 | 18% |
| Bad Debt Provision (BDP) | -34 | -40 | – |
| Programs indirect cost | -27 | -1 | – |
| Other income/Expense | 88 | -2 | – |
| Operating Surplus | 226 | 78 | 191% |
| Net investment income | 304 | 303 | 1% |
| Shareholders expense and others | -7 | -8 | -16% |
| Policyholders surplus | -43 | -22 | 95% |
| Net income (before Zakat) | 480 | 350 | 37% |
Statement of Financial Position for 2022
| Description (SR ‘000) | Dec-22 | Dec-21 | % of change |
| Investment | 7,118 | 6,302 | 13 |
| Receivables | 5,422 | 3,222 | 68 |
| Reinsurance recoverable & Others | 3,467 | 2,944 | 18 |
| Other assets | 1,249 | 1,062 | 18 |
| Cash | 1,659 | 1,188 | 40 |
| Total Assets | 18,915 | 14,718 | 29 |
| Reserves | 12,320 | 9,278 | 33 |
| Accrued Expenses & Others | 3,230 | 2,401 | 35 |
| Total Liabilities | 15,550 | 11,679 | 33 |
| Others equities | 2,567 | 2,580 | 0 |
| Retained earnings | 798 | 459 | 74 |
| Total Equity | 3,365 | 3,039 | 11 |
| Total Liabilities and Equity | 18,915 | 14,718 | 29 |
