Damages from the unprecedented rains recorded on April 16 were compounded by the loss of Dh18m in deposits by Azizi Credit, leading Shariah-compliant insurer Watania International Holding (WIH) a Dh3.9m net loss in the first half of the financial year 2023, which improved to Dh7.9m net profit in the first half of 2024.
“The one in seventy five year April rains event was a turning point for the insurance industry in the UAE and was an event that we had not prepared for,” said Dr Ali Saeed Bin Harmal Aldhaheri Chairman of WIH.
In 2020, Dar Al Takaful bought out Noor Takaful and later in July 2022, the National Takaful Company (Watania) merged with Dar Al Takaful into a single entitiy of Takaful business in the UAE. In March 2023 the company’s name was changed to Watania International Holding and its insurance license was revoked because the company has transformed into an investment holding company that is interested in developing its activities through Shariah compliant investments in the sphere of Takaful and Islamic insurance.
WIH and other players in the industry noted that they received many claims after the rains especially in the motor and property lines.
Takaful earnings during the first half of the year January-June 2024 were Dh389 million compared to Dh457 million for the same period last year, a decline of about 15 percent.
‘Operational profits remained on track’
Aldhaheri said they are still hopeful on the rest of the financial year primarily because of the further enhancement of the firm’s health and balance sheet.
“The business turnaround we achieved towards the end of 2023 resulted in a healthier balance sheet due to the ongoing enhancements of the financial and business outlook of our Watania Takaful subsidiaries.”
“Although we expected the combined ratio to be significantly affected by the one-time claims arising from the severe weather event especially on the motor and technical classes, steady improvement noted on the Medical and group Family (life) Takaful business, better underwriting exercise and improved pricing particularly post rains sustained on going journey of increase in operational profit.”
Datta is optimistic that the remaining part of the year’s financial performance will be good.
