Al-Saqr Insurance: Comprehensive Analysis of Financial Performance

Al-Saqr Cooperative Insurance Company was established in 1983, becoming one of the first insurance companies to adopt the cooperative system in the Kingdom of Saudi Arabia. The company's establishment was a response to the growing need for Sharia-compliant insurance services, as cooperative insurance is based on the principle of risk and profit sharing among shareholders and policyholders. Throughout its long journey, the company has witnessed significant developments, including geographical expansions, product updates, and the adoption of governance and transparency standards imposed by the Capital Market Authority.

Since its listing on the Saudi financial market (Tadawul), the company has gained high credibility among investors and clients alike. Al-Saqr's growth is based on a strong capital base and a local management structure, enabling it to absorb economic changes and keep pace with the aspirations of the modern Saudi market. This long history and accumulated experience have enhanced the company's reputation among cooperative insurance companies in the Kingdom.

Al-Saqr Insurance relies on the cooperative insurance system (Takaful), which differs from traditional insurance in terms of risk-bearing mechanisms and profit distribution. In this model, policyholders pay premiums that are placed in a common fund used to compensate the affected parties when a risk occurs, and any surplus—if available—is distributed to shareholders or policyholders according to Sharia and regulatory guidelines.

This system reinforces the principles of cooperation and fairness among individuals, adhering to the transparency and governance standards imposed by Saudi regulatory authorities. Al-Saqr Insurance is committed to applying international accounting standards and financial disclosure standards, which enhances customer and investor confidence in the company. Additionally, the cooperative system helps mitigate the volatility of financial results compared to some traditional commercial insurance models.

Al-Saqr Insurance offers a wide range of insurance products that meet the needs of individuals and businesses in the Saudi market. These products include:

- Cooperative Health Insurance: This is one of the largest segments in terms of written premiums and number of clients, especially with the increasing government mandate for health insurance for employees.
- Vehicle Insurance: This includes mandatory insurance (third-party) and comprehensive car insurance, capturing a significant market share due to the mandatory vehicle insurance in Saudi Arabia.
- Property Insurance: This includes coverage against fire, theft, and natural disasters, serving both commercial and residential sectors.
- Engineering Insurance: This covers construction projects and equipment, a sought-after product with the growth of the real estate and infrastructure sectors.
- Civil Liability Insurance: This includes coverage for professional errors, general accidents, and liability towards third parties.

Al-Saqr Insurance continuously seeks to develop its products to meet market needs and enhance customer satisfaction, offering advanced electronic services to facilitate issuance and claims processes.

Al-Saqr Cooperative Insurance Company adheres to an organizational structure characterized by transparency and compliance with the regulations of the Saudi Capital Market Authority. An elected board of directors sets the company's general policies and approves strategic plans, while the executive management oversees daily operations and product development.

The company undergoes annual financial audits by an independent external auditor and provides quarterly and annual financial reports published on the Tadawul website in accordance with regulatory requirements. Al-Saqr emphasizes enhancing internal control, risk management, and developing human capital through specialized training programs. All these elements contribute to bolstering the confidence of shareholders and clients and support the company's sustainability in a changing competitive environment.

Al-Saqr Insurance's stock is listed on the main Tadawul market under the symbol (8180) and enjoys good liquidity compared to other mid-sized insurance companies. The stock has experienced moderate price fluctuations during 2024 and 2025, with prices ranging between 11 and 13 Saudi Riyals for most periods, with a current average price of approximately 11.5 Riyals based on the latest available data.

This performance reflects the stock's interaction with the company's financial results and sector news, in addition to being influenced by macroeconomic factors in the Kingdom such as oil prices, reinsurance costs, and general market trends. Since the stock is subject to strict disclosure requirements, investors can monitor its data in real-time via the Tadawul platform. It is noted that the stock tends to exhibit relative stability and achieves regular periodic distributions, making it of interest to a segment of investors seeking fixed income.

Recent financial data indicates strong and stable performance for Al-Saqr Insurance during 2024-2025. The following are the key indicators:

- Stock Price: Approximately 11.5 Saudi Riyals.
- Market Capitalization: Estimated at around 4.6 billion Riyals, based on the number of outstanding shares (400 million shares).
- Price-to-Earnings Ratio (P/E): Approximately 14, which is within the acceptable range for the Saudi insurance sector.
- Cash Dividend Yield: Ranges between 8% and 10% annually, with a distribution of 60 Halalas per share in the latest announcement.
- Revenue Growth: Revenues increased by 15%-18% in 2024 compared to the previous year.
- Net Profit: Reached approximately 245 million Riyals for 2024, an increase of over 11% from 2023.

These indicators reflect the company's resilience in facing operational challenges and the management's ability to capitalize on market opportunities while maintaining a strong financial position.

The Saudi insurance sector is one of the fastest-growing sectors in the national economy, driven by government reforms, increased insurance awareness, product diversification, and rising demand for health and vehicle insurance. Although the penetration rate of insurance to GDP remains low (1.5%-2%) compared to the global average, this indicates significant future growth potential for companies operating in the market.

The sector faces challenges including intensified competition, stricter technical reserve requirements, the implementation of international standards (IFRS 17), and structural changes in the market. Conversely, Saudi Vision 2030 offers opportunities to expand insurance services, especially with the growth of construction, modern technologies, and health sectors.

Al-Saqr Insurance, like other cooperative companies, benefits from a supportive regulatory environment but is also required to adapt to rapid changes to maintain its market share and achieve sustainable growth.

Al-Saqr Insurance adopts an operational strategy focused on product diversification, service quality improvement, and expanding its customer base. The company invests in digital transformation by offering advanced electronic services such as online policy issuance and claims management, enhancing operational efficiency and reducing service costs.

In terms of marketing, the company relies on advertising campaigns, partnerships with brokers, and participation in industry conferences to enhance its brand presence. It also places importance on improving customer satisfaction and retention through loyalty programs and after-sales services. This strategy aims to increase market share and achieve competitive differentiation in a rapidly changing and highly competitive sector.

Al-Saqr Insurance faces strong competition from several major companies in the Saudi market, including:

- Salama (Cooperative Insurance): The largest in terms of market share and product diversity.
- Walaa Insurance: Focused on general and vehicle insurance.
- Al-Jazira Insurance: Strong presence in banking partnerships and commercial insurance.
- United Insurance: Distinguished in engineering and property insurance.
- Al-Rajhi Takaful Insurance: Rapid development in health and banking insurance.

Al-Saqr seeks to address this competition by improving services, offering competitive pricing, and developing products according to customer needs. Maintaining high levels of customer satisfaction and responding quickly to market changes are among the key factors for the company's success in facing competitors.

Recently, significant regulatory changes have occurred in the Saudi insurance sector, most notably the transfer of oversight to the Capital Market Authority and the implementation of International Financial Reporting Standards (IFRS 17). These changes aim to enhance transparency, protect policyholder rights, and improve the quality of financial reporting.

Al-Saqr Insurance has announced its full commitment to these requirements and has developed its accounting and administrative systems to ensure compliance with the new standards. Regular periodic disclosures and governance reports enhance the company's credibility with shareholders and regulatory authorities. Compliance with regulations is considered one of the most important elements of the company's stability and its ability to continue in a competitive market.

During 2024-2025, Al-Saqr Insurance experienced several significant events, including:

- Temporary suspension of stock trading in December 2025 pending the announcement of fourth-quarter results, a routine regulatory measure when financial disclosures are delayed.
- Continued periodic disclosures and a 9% profit growth in the first quarter of 2024, along with improved profit margins in the second quarter.
- Distribution of cash dividends amounting to 6% of the stock value in 2024.
- Expansion of health insurance services and the launch of an electronic platform for policy issuance.
- The company received a credit rating of (A-) and the award for Best Takaful Insurance Company for 2024.

These developments reflect the company's commitment to transparency, continuous improvement, and building trust with shareholders and clients.

Al-Saqr Insurance's results for 2024 indicate significant growth in revenues and profits. Revenues in the third quarter reached approximately 350 million Riyals, representing a growth of 15% compared to the same period in 2023. Net profit in the same quarter was around 60 million Riyals, raising the total cumulative profit for the first nine months to 180 million Riyals, compared to 160 million in the same period of 2023.

For the full year, the company achieved an annual net profit of approximately 245 million Riyals, with a total revenue increase of 18%. This strong performance is reflected in the company's continued distribution of cash dividends ranging from 8% to 10% of the stock price, a high rate compared to the Saudi market average. These figures reflect the company's ability to manage operations efficiently and achieve attractive returns for shareholders.

Al-Saqr Insurance has future growth opportunities based on several factors:

- Increasing legal mandates for health and vehicle insurance.
- Expansion of the Saudi economy and increased construction projects.
- Growing demand for specialized insurance products such as cybersecurity and property insurance.
- Utilization of technology in services and improving customer experience.

Despite these opportunities, the company must continue to adapt to competition and regulatory pressures, enhancing operational efficiency to achieve sustainable growth. Additionally, its ongoing distribution of attractive dividends and maintaining a strong financial solvency will support its position in the Saudi market.