Saudi Reinsurance Company · TADAWUL:8200
Saudi Reinsurance — Investor Presentation (2022)
39 slides from Saudi Reinsurance's investor presentation, 2022
Slide 1: Investor Presentation Financial Year 2021
Investor Presentation Financial Year 2021 Saudi Reinsurance Company TASI 8200 RIC 8200.SE ISIN SA1210540419 Saudi Re IR App : Public
Slide 2: Disclaimer
Disclaimer This presentation has been prepared by the management of Saudi Reinsurance Co “Saudi Re” (“The Company”). It does not constitute or form part of, and should not be construed as, an offer, solicitation or invitation to subscribe for, underwrite or otherwise acquire, any securities of the C
Slide 3: Scaling the Heights
Scaling the Heights Our saga to date tells of a historic journey of exponential growth and diversification. At inception, we focused on building capacity while setting a tone and an ethos. Very rapidly, we were making inroads regionally and building scale. And last year, Saudi Re recorded phenomenal
Slide 4: Public
63L__c| Regulated by Saudi Central Bank Sa udi Rey Saudi Reinsurance Company ‘www.Saudi-re.com
Slide 5: Profile and Strategic Direction
Profile and Strategic Direction Public
Slide 6: Saudi Re Profile
Saudi Re Profile A 1st Established SAR 891M A3 Saudi Reinsurer 2008 Capital Rating by Moody’s +300 +100 +40 57% Clients – B2B Employees Countries International Business Ranks 1# HO: Riyadh Among Middle Branch: Malaysia East Reinsurers 6 Public www.saudi-re.com
Slide 7: Board of Directors
Board of Directors Rich & Diversified Experiences Hesham Al Shaikh, Chairman Mishari Al Mishari, Ahmed M. Sabbagh, • 35+ years in financial services Vice Chairman Member of the Board • Chairman of the Board, member • 35+ years in financial services. • 40+ years in KSA insurance sector • Vice-Chairma
Slide 8: Executive Management
Executive Management Sound Industry Knowledge • 30+ in accounting, • 20+ of experience in the KSA finance, investment, and insurance sector with focus risk management on strategy management, HR, • Worked in in Insurance and business development and Reinsurance • Served as GM Strategy and Companies G
Slide 9: Strategic Direction
Strategic Direction Focus On Delivering Value To Stakeholders 9 Public www.saudi-re.com
Slide 10: Saudi Re Future Growth
Saudi Re Future Growth Leveraging Competitive Advantage in Home Market to Grow and Diversify Internationally Leverage competitive advantage in home market Support local market retention and capitalize ` Saudi Re as the National Reinsurer on potential growth in the Kingdom Sustainable Local lon
Slide 11: Strategic Milestones
Strategic Milestones Steady Growth Trajectory Proposed rights issue 2 for1: Capital Exclusive Exceeding 1B Reinsurance GWP Increase By 50% Right For IDI insurance Reached 1B A3 Rating Capital Premiums 60% Increase By International 10% Lloyd’s Investing In LloydsBusiness Participation Probitas Holdin
Slide 12: Saudi Re Geo Presence
Saudi Re Geo Presence International Expansion & Diversification 40+ MARKETS 1 Serving clients UK in 40+ countries in MENA, Asia Asia 16 and Africa BANGLADESH BRUNEI CAMBODIA CHINA INDIA INDONESIA KAZAKHSTAN Africa 19 Middle East 9 MALAYSIA PAKISTAN PHILIPPINES ALGERIA SAUDI ARABIA SINGAPORE BOTSWANA
Slide 13: 2021 Performance
2021 Performance o3aL__c] Saudi Re
Slide 14: Value Drivers: 2021 At A Glance
Value Drivers: 2021 At A Glance Saudi Re well geared for higher growth CAGR 19% strong growth momentum in 2018-2021 Reinsurance 10% capital Company increase by of the Year bonus shares award 2021 GWP 1.1 Billion Strong Competitive positon Net profit A3 SR 38.9 million stable outlook UW Profit credit
Slide 15: Competitive Ranking
Competitive Ranking Growth Relative to Peers Middle East GWP Ranking USD M 2010 2021 Best Re 371 Saudi Re 297 Trust Re 302 CCR 285 Arig 240 SCR 280 IGI 179 Kuwait Re 249 Kuwait Re 119 ACR ReTakaful Hannover Re* 143 118 Qatar Re 81 Arab Re* 60 Hannover ReTakaful 80 Tunis Re 51 CCR 78 Arig Emirates Re
Slide 16: Underwriting Portfolio Overview
Underwriting Portfolio Overview Diversified Growth SAR, MM Gross Written Premium (GWP) Portfolio Mix – Line of Business, 2021 1,116 Others Engineering 986 935 15% 942 8% 805 792 482 Fire 721 Speciality 346 16% 22% 556 507 702 322 420 519 288 279 245 160 221 588 633 Health 107 435 433 470 51 147 12%
Slide 17: Financial YOY Comparison
Financial YOY Comparison Sustainable profitability SAR'000 31-Dec-21 31-Dec-20 31-Dec-19 31-Dec-18 31-Dec-17 31-Dec-16 Gross premiums written 1,115,879 935,114 792,848 721,605 942,007 985,510 Net premiums written 958,968 772,639 646,605 616,896 636,921 938,184 Net premiums earned 854,730 647,121 642
Slide 18: Key Operational Ratios
Key Operational Ratios Sustainable Performance 2021 2020 2019 2018 2017 2016 31-Dec-21 31-Dec-20 31-Dec-19 31-Dec-18 31-Dec-17 31-Dec-16 Premium Growth 19% 18% 10% -23% -4% 22% Retention Ratio 85.9% 83% 82% 85% 68% 95% Net Claims Ratio 66.1% 61% 65% 66% 70% 80% Net Acquisition cost ratio 25.5% 29% 2
Slide 19: Investments
Investments Composition Comparison and Performance Breakdown Shareholders’ Funds Policyholders’ Funds Total Portfolio (SAR m) Total Portfolio (SAR m) 560.2 920.2 874 870 821 824 98.3 370 163.9 338 143 147 122 126.5 295 57 0 91.6 70 20.4 0 0 241 0 104 0 68 174 317 436.4 54 300 461.9 445 53 370 337.7
Slide 20: International Expansion
International Expansion Strategic Investment Probitas Holdings Bermuda Ltd. (PHBL) Acquisition GWP, USD M In 2017, Acquired 49.9% of PHBL ordinary shares. 227.5 176.34 Transaction Value: USD 25 M. 169.7 163.76 146.55 Additional Capital injection : USD 1M. Probitas Holdings (Bermuda) Limited
Slide 21: International Expansion
International Expansion Strategic Investment Top performing Lloyd's Syndicates By Combined Ratios Combined Ratio Profit/loss (£ m) GWP (£ m) 2020 2019 2020 2019 2020 2019 Chaucer 1176 38.8 27.7 18.6 22.0 29.4 98.1 Probitas 1492 85.6 94.4 17.9 7.8 144.8 133.8 Lancashire 3010 87.8 90.2 6.7 5.2 123.0 9
Slide 22: Inherent Defects Insurance (IDI)
Inherent Defects Insurance (IDI) A Key Driver for Growth and Sustainable Profitability IDI implementation is not enforced enough as the Saudi Building Code had hindered new developments MoMRA has now delayed the requirement for IDI policies, and to be aligned with the construction period instead of
Slide 23: Inherent Defects Insurance (IDI)
Inherent Defects Insurance (IDI) A Key Driver for Growth and Sustainable Profitability Background Model Mandated by the Council of Ministers Resolution No. 509 issued on June Premium 5, 2018 requiring all contractors involved in private sector construction projects to obtain an IDI policy. Insured
Slide 24: Inherent Defects Insurance (IDI)
Inherent Defects Insurance (IDI) A Key Driver for Growth and Sustainable Profitability Design Phase Practical completion Construction Phase Provide completion Provide underwriting info Notify eventual certificates, confirm final (general drawings, sum insured, construction construction costs ground
Slide 25: Key Developments
Key Developments o3aL__c] Saudi Re
Slide 26: Capital Increase - 2022
Capital Increase - 2022 Recommended Rights Issue boosts capital by 50% Saudi Re – Recommended Rights Issue SR 445.5M boosts equity by 50% to SR 1,336 Underwriting growth International (domestically): Credit Rating: Diversification 1. SAMA’s reinforced 1. Rights issue paves 1. Preemptive capital comp
Slide 27: Capital Increase - 2022
Capital Increase - 2022 Proposed rights issue boosts capital by 50% ahead of peak GWP growth and valuations All time high GWPs Turnaround to profitability sustained 1,116M 986M 942M Net Loss Ratio SAR M 935M 201% 189% 805M 793M 722M 146% 556M 114% 105% 101% 100% 103% 100% 97% 99% 92% 96% 420M 245M 1
Slide 28: IFRS 17 - Update
.° - 7 68eS fe -a> oe 7, of mM oe eo age cesar se oo ohare Faves Zaee ongege > 0.105095 9 8000+ « ee, 2? @e hat oe Paes e gee Goce reg lianas 0524602 50022005 fa : oO ~ © TS 2. =) 1 ~n =i ”n co od Saudi Rey 62 Public
Slide 29: 2021 Financials Note 3 Overview
2021 Financials “Note # 3” Overview This standard has been published on May 18, 2017, it These components should be accounted for separately establishes the principles for the recognition, in accordance with the related standards (IFRS 9 and measurement, presentation and disclosure of IFRS 15).
Slide 30: IFRS 17 Awareness
IFRS 17 Awareness Measurement Models Definitions There are three measurement models under IFRS Risk adjustment: reflects the compensation 17: that Saudi Re requires for non-financial risks that are present in the contracts sold, 1. General model (GM): Default model for all (re)insurance contracts
Slide 31: IFRS17 Awareness
IFRS17 Awareness Measurement Model for Non Life (Re)insurers Current IFRS New IFRS (17) General Model PAA Risk adjustment Risk adjustment Expired Risk Discounting Discounting Claim Reserve Expected value of future Expected value of future cash flows cash flows Contractual service margin Uneared Prem
Slide 32: IFRS17 Awareness
IFRS17 Awareness Transition Comparative • Retrospective Approach: IFRS 17 is applied • IFRSs require an entity to present one year of retrospectively to all contracts in-force at the comparative information., therefore, 2022 transition date unless it is impracticable to do financial will be presente
Slide 33: IFRS17 Awareness Saudi Re's IFRS17 Program Timeline
IFRS17 Awareness Saudi Re’s IFRS17 Program Timeline Impact assessment Completed Q1 2019 Solution development and build Design Complete by end of Program Go live Complete technical Q3 2021 Mobilization Business as usual policy, data Parallel run 2018 assessment and initiation vendor selection by end
Slide 34: Business and Market Update
Business and Market Update Public
Slide 35: Key Developments – 2021 Review
Key Developments – 2021 Review Market conditions paint a brightening UW outlook Local market indicates Approval of the Amendment of Signs for market new trend in new lines classifications of risks Cooperative Insurance hardening globally as a and compulsory which will be mandated Control Law. reacti
Slide 36: Financial Strength Rating
Financial Strength Rating Reflecting Competitive Advantages and Solid Financial Position A3 Stable AA+ Stable The A3 IFSR of Saudi Re reflects its: According to Tassnief, , the rating of Saudi Re reflects its (i) strong brand and market position in Saudi Arabia as the strong brand strength, risk pro
Slide 37: ESG
ESG Framework Sustainability Framework Saudi Re sustainability framework has been developed in line with national and international strategic visions and objectives such as the Kingdom of Saudi Arabia Vision 2030, the National Sustainability Standards, the GRI Standards, and the United Nations Sus
Slide 38: Shariyah Compliant
Shariyah Compliant Shariyah Review Bureau 38 Public www.saudi-re.com
Slide 39: Thank you
Thank you Investor Relations: Ahmad Al-Daham Assistant Manager – Investor Relations & Sustainability aaldaham@Saudi-Re.com +966 11 510 2181 +966 11 510 2000 Saudi Re IR App Public
Saudi Reinsurance Company — Investor Presentation (2022) on 6ix