United Cooperative Insurance Company is one of the prominent firms in the cooperative insurance sector within the Saudi financial market. Since its establishment in 2008, the company has played a pivotal role in providing commercial and group insurance solutions, excluding protection and savings products. The company's offerings cover diverse sectors, including property, equipment, energy, accidents, health, and shipping, making it a primary choice for companies and institutions with varied insurance needs.
United Cooperative Insurance Company is supervised by Saudi regulatory bodies, primarily the Capital Market Authority and the Saudi Arabian Monetary Authority, ensuring its compliance with the highest standards of transparency and governance. In recent years, the company has faced significant profitability challenges, with accumulated losses exceeding half of its paid-up capital. Nevertheless, it has continued to develop its offerings and improve its operational processes.
The performance of United Cooperative Insurance Company reflects the dynamic changes in the Saudi insurance sector, which faces increasing competition and new regulatory pressures, alongside growth opportunities linked to rising insurance awareness and Vision 2030 projects. In this article, we will detail the company's history, product structure, financial status, challenges and opportunities, as well as an in-depth analysis of the sector and competition, reviewing the latest regulatory and operational developments. This educational presentation does not include any investment recommendations and aims to provide an objective view to help investors and interested parties better understand the reality of the company and the sector.
History and Establishment of United Cooperative Insurance Company
United Cooperative Insurance Company was established in May 2008 as a Saudi joint-stock company and began its actual insurance activities in January 2009. Its establishment came in line with a government trend to enhance the cooperative insurance sector, adhering to local regulations that require full Saudi ownership and close supervision by regulatory bodies. The company's headquarters is located in the capital, Riyadh, with a paid-up capital of 400 million Saudi Riyals.
Since its inception, the company has placed significant emphasis on developing insurance products that meet the needs of the Saudi market, supported by a management team with local and international expertise in insurance. Over more than a decade, the company has undergone stages of expansion and development, including launching new products, expanding its client network, and updating technological systems to facilitate claims service and enhance customer experience. As the insurance sector in the Kingdom evolved, United faced several challenges, including increased competition and profitability pressures, yet it continued its efforts to improve financial and operational performance, aiming for long-term financial sustainability.
Product and Service Structure at United Cooperative Insurance Company
United Cooperative Insurance Company is distinguished by its diverse range of insurance products, focusing on all types of commercial and group insurance, excluding protection and savings products. These products include property insurance, equipment, engineering insurance, energy, accidents, health, marine and air shipping insurance, and liability insurance.
All these products are subject to licenses and regulations issued by Saudi regulatory authorities, ensuring compliance with global best practices in risk management and service delivery. The company primarily targets the corporate and institutional sectors, especially those operating in construction, energy, transportation, and health services, in addition to covering risks associated with marine and air shipping. The company also keeps pace with technological developments by launching digital platforms to facilitate underwriting and claims management.
Practically, the company aims to provide tailored solutions for large clients, focusing on flexibility and speed in responding to claims. This is evident in its ability to design comprehensive insurance programs that meet the needs of major projects, giving it a competitive edge in the Saudi market.
Organizational Structure and Regulatory Supervision of the Company
United Cooperative Insurance Company is subject to dual supervision by the Saudi Capital Market Authority (CMA) and the Saudi Arabian Monetary Authority (SAMA), in addition to the Cooperative Health Insurance Council and the Insurance Authority. Saudi regulations require insurance companies to adhere to sound governance, maintain financial transparency, and provide periodic reports on their financial and operational performance.
The company's organizational structure consists of a board of directors with expertise in both the financial and insurance sectors, along with specialized committees for risk, auditing, governance, and remuneration. The company also has an executive management team responsible for implementing strategic policies and achieving financial and operational objectives. In recent years, the company has seen changes in executive management, including the appointment of a new interim CEO at the beginning of 2025, as part of a plan to restructure operations and improve financial performance.
This regulatory and organizational framework enhances the confidence of both investors and clients, while also facilitating quick adaptation to evolving legislative requirements in the Saudi insurance sector.
Financial Performance of United Cooperative Insurance Company
As of the end of 2025, the financial data for United Cooperative Insurance Company indicates ongoing challenges regarding profitability. The stock price in the latest trades was approximately 5.05 Saudi Riyals, with a market capitalization of around 202 million Riyals. The company suffers from accumulated losses exceeding 50% of its capital, placing it among the companies subject to special regulatory procedures by the financial market.
In terms of profits, the company has not achieved positive net profits in recent years, attributed to high claims costs and operating expenses. The price-to-earnings ratio (P/E) is currently unavailable or irrationally high due to the absence of profits. The company has not declared cash dividends in recent years, and the dividend yield is currently zero.
On the revenue side, the company recorded slight growth in total written premiums, but this growth did not reflect in net results due to high claims and reinsurance costs. Management is currently implementing strategies to control expenses and improve the insurance portfolio. Detailed financial results can be viewed on the official Tadawul website.
Analysis of the Cooperative Insurance Sector in Saudi Arabia
The cooperative insurance sector in Saudi Arabia possesses unique characteristics, as ownership of insurance companies is limited to Saudi citizens and is subject to strict supervision by regulatory bodies. The sector is experiencing high competitiveness, particularly with the shift towards digitizing services and increasing capital and financial solvency requirements.
The sector faces challenges related to rising claims costs, especially in health and engineering insurance, along with pricing pressures resulting from intense competition. Additionally, International Financial Reporting Standards (IFRS) impose additional obligations on companies, reflected in increased reserves and decreased profit margins.
On the other hand, significant growth opportunities exist in the sector, especially with the low insurance penetration rate compared to developed countries. The Saudi government supports the expansion of health insurance and mandatory insurance, alongside the growth of infrastructure projects under Vision 2030, creating increasing demand for engineering and energy insurance products. Government policies also encourage mergers between insurance companies to enhance sector stability and protect the rights of shareholders and clients.
Current Status of Accumulated Losses and Their Regulatory Impact
Accumulated losses are one of the main challenges facing United Cooperative Insurance Company at present, exceeding half of the paid-up capital. As a result, the company is subject to special supervisory procedures by the financial market and the Insurance Authority, aimed at protecting shareholders' rights and ensuring the company's continuity.
These procedures include the necessity of periodic disclosure of loss ratios and presenting plans for capital restructuring or improving financial performance. If losses continue without improvement, the company may be required to increase capital or explore merger options with other companies to enhance financial solvency. These losses directly affect the company's ability to distribute dividends, as accumulated losses must be cleared first.
The company is committed to complying with all regulatory requirements and is currently implementing plans to reduce costs and enhance revenue growth, focusing on improving the quality of the insurance portfolio and reducing operational risks.
Competition in the Saudi Insurance Market and Key Competitors
United Cooperative Insurance Company is part of a strong competitive environment in the Saudi market, sharing market share with several major and medium-sized insurance companies. Key competitors include: Tawuniya Insurance Company, Malath Cooperative Insurance Company, Arab Cooperative Insurance Company, Gulf Arab Cooperative Insurance Company (Mudgilaf), and Alinma Cooperative Insurance Company.
Competition in the sector is characterized by a focus on service quality, speed of claims settlement, and providing innovative solutions for large clients and institutions. Companies also compete for engineering, energy, and major project insurance contracts, in addition to expanding health insurance products for individuals and companies.
United Cooperative Insurance aims to strengthen its position by developing specialized products in the engineering and energy sectors, leveraging its experience in managing technical risks. The company also monitors market movements related to mergers and acquisitions, which may create larger and more competitive entities in the near future.
Recent Developments and News for the Company (2024-2025)
United Cooperative Insurance Company has witnessed several significant developments in both financial and operational aspects during 2024 and 2025. The company announced semi-annual financial results showing modest growth in total written premiums, with ongoing operational losses. Management is currently focusing on controlling expenses and improving the quality of the insurance portfolio.
Noteworthy developments include the company's announcement of signing a memorandum of understanding with Arab Cooperative Insurance Company to study the feasibility of a potential merger. This step aims to enhance competitiveness, expand market share, and reduce administrative costs. The feasibility study is still ongoing, and the implementation of the final merger is subject to regulatory approval.
On the management front, the company has seen a change in executive leadership with the appointment of a new interim CEO as part of a plan to restructure operations. The company is also committed to updating its technological systems and improving customer experience, alongside launching new products in the energy and marine shipping sectors, and actively participating in conferences and community activities to enhance its brand.
Company Strategy for Digital Transformation and Service Development
United Cooperative Insurance Company is keeping pace with the rapid digital transformation in the Saudi financial sector by developing advanced electronic platforms for managing insurance operations. The company has launched digital gateways that allow clients to submit and track claims electronically, in addition to applications that facilitate underwriting and document renewal procedures.
This transformation aims to improve customer experience, reduce the time required to process claims, and lower operational costs. The company also relies on artificial intelligence systems to analyze risks and tailor products for large clients, focusing on cybersecurity and data protection.
This strategy enhances the company's competitiveness in a market witnessing increasing demand for digital services, while also contributing to expanding the customer base and facilitating access to insurance products for both individuals and companies.
Merger Plan with Arab Cooperative Insurance Company and Its Potential Impact
In mid-2025, United Cooperative Insurance Company announced the signing of a memorandum of understanding with Arab Cooperative Insurance Company, paving the way for a feasibility study of a potential merger between the two companies. This step aligns with a general trend in the Saudi insurance sector to enhance financial stability through the merger of medium and small entities.
The potential merger aims to unify resources, strengthen the capital base, and expand the insurance portfolio, enabling economies of scale and reducing administrative costs. The merger is also expected to enhance the competitiveness of the merged company, increase market share, and provide more diverse products for clients.
The merger is still in the study and evaluation phase and is subject to final approval from regulatory authorities. If approved, the capital structure may undergo changes, with the possibility of issuing new shares or restructuring existing shares. Investors are paying close attention to this step due to its potential impact on the company's future and financial stability.
Impact of Government Policies and Vision 2030 on the Insurance Sector
Saudi government policies and Vision 2030 play a pivotal role in developing the cooperative insurance sector. The vision supports the expansion of mandatory health insurance, encourages higher insurance coverage rates for citizens and residents, and enhances the role of insurance in large infrastructure projects.
The government aims to increase the insurance penetration rate as a percentage of GDP by requiring companies and institutions to have advanced insurance coverage and expanding the range of available insurance products. Regulatory authorities also encourage mergers and acquisitions among insurance companies to improve financial solvency and ensure the continuity of the sector.
United Cooperative Insurance Company interacts with these policies by developing new products and keeping pace with the latest regulatory requirements, focusing on the engineering, energy, and health sectors that are prioritized in Vision 2030 programs.
Risk Management Strategies and Improving the Insurance Portfolio
United Cooperative Insurance Company places great importance on risk management as a core element for business sustainability and improving financial results. The company relies on strict underwriting policies, with careful evaluation of risks associated with each sector or client, including engineering, energy, accidents, and health risks.
The company seeks to achieve a balance between diversifying the insurance portfolio and retaining reasonable risks, relying on reinsurance programs to distribute risks and mitigate the impact of large claims on financial results. It also focuses on developing specialized products that meet the needs of major projects, enhancing collaboration with local and international reinsurers.
Policies are periodically reviewed to ensure compliance with regulatory requirements and best practices in risk management in the sector, helping to improve financial solvency and reduce operational loss ratios.
Future Challenges and Opportunities in the Saudi Insurance Market
The Saudi insurance market faces multiple challenges, most notably rising claims costs, intense competition, and high capital requirements. Legislative changes, such as the implementation of new international accounting standards, also affect profit margins and financial disclosures.
Despite these challenges, significant growth opportunities arise from increasing insurance awareness, expanding infrastructure projects, and growing demand for health and medical insurance. The digital transformation also provides opportunities for delivering innovative services and expanding the customer base.
United Cooperative Insurance Company aims to capitalize on these opportunities by developing new products, improving operational processes, and exploring strategic partnerships, including potential mergers, to strengthen its market position and achieve long-term financial sustainability.
Conclusion
The cooperative insurance sector in Saudi Arabia represents a dynamic environment filled with both challenges and opportunities. United Cooperative Insurance Company, through its journey and experience since 2008, reflects the ability of medium-sized companies to adapt to regulatory and competitive changes, despite challenges related to accumulated losses and profitability.
By developing specialized products, embracing digital transformation, and pursuing strategic partnerships and potential mergers, the company continues its efforts to strengthen its market position and achieve financial sustainability. With ongoing government support for the insurance sector under Vision 2030, promising opportunities for growth and improvement remain, provided that risk management and operational performance continue to be refined.
Investment decisions in the company's shares or any other insurance company require careful consideration and comprehensive analysis of financial data, risks, and opportunities. Therefore, the SIGMIX platform always recommends the importance of consulting a licensed financial advisor before making any investment decision, to ensure that decisions are based on scientific and objective foundations that consider each investor's financial goals.
Frequently Asked Questions
United Cooperative Insurance Company offers a diverse range of insurance products, focusing on group and commercial insurance, excluding protection and savings products. These include property insurance, equipment, engineering and energy insurance, accidents, health, marine and air shipping insurance, and liability insurance. These products target large companies and institutions, with flexibility in designing insurance programs according to client needs and in accordance with regulatory requirements issued by Saudi regulatory authorities.
United Cooperative Insurance Company has experienced slight revenue growth in recent years; however, it continues to record net losses due to high expenses and claims costs. The stock price recently stood at approximately 5.05 Saudi Riyals, with a market capitalization of around 202 million Riyals. The company has not generated sufficient profits for distribution to shareholders, and the price-to-earnings ratio is unavailable due to ongoing accumulated losses.
The company has accumulated losses exceeding 50% of its paid-up capital due to high claims costs, reinsurance expenses, and operating costs. This situation forces the company to implement restructuring plans and improve financial performance, preventing it from distributing dividends in the near term. This situation is under the monitoring of regulatory authorities, with the possibility of requiring capital increases or exploring mergers with other companies to improve financial solvency.
United Cooperative Insurance Company has not announced cash dividends to shareholders in recent years due to ongoing accumulated losses and the absence of net profits. The dividend yield is currently zero, and dividends will only be distributed after the company recovers financially and corrects the accumulated losses, as determined by regulatory regulations.
United Cooperative Insurance Company signed a memorandum of understanding with Arab Cooperative Insurance Company to study the feasibility of a potential merger between the two companies. This step aims to strengthen the capital base, expand market share, and improve operational efficiency. The merger is still in the study and evaluation phase and is subject to final approval from regulatory authorities. If the merger occurs, the merged company may experience changes in its capital structure and expand its customer base.
Government policies and Vision 2030 play a key role in enhancing the insurance sector by expanding mandatory health insurance, supporting infrastructure projects, and encouraging mergers among insurance companies. United Cooperative Insurance Company aligns with these trends by developing new products and improving operational processes, providing it with growth opportunities amid increasing demand for insurance solutions in the Kingdom.
The company faces multiple risks, most notably rising insurance claims costs (especially in health and engineering), intense market competition, pricing pressures, and high capital requirements. Legislative changes, such as the implementation of new IFRS standards, also impact financial results. The company seeks to address these risks by improving insurance portfolio management, controlling expenses, and developing specialized products.
The company relies on a digital transformation strategy to provide more efficient and faster services to customers through electronic platforms for managing claims and underwriting, and developing digital applications for easy document renewal and issuing quotes. It also focuses on expanding its customer base through awareness campaigns and new products targeting individual and corporate sectors, while improving customer experience and increasing satisfaction with the services provided.
Due to ongoing losses and the absence of net profits, the price-to-earnings (P/E) ratio for United Cooperative Insurance Company's stock is currently unavailable or meaningless, unlike some major competitors that generate profits and trade at positive price-to-earnings multiples. Therefore, evaluation relies on other factors such as asset value, capital solvency, and potential future opportunities if financial performance improves or mergers are completed.
Given the complexity of the insurance sector and its rapid changes, along with challenges related to profitability and capital, it is essential to consult a licensed financial advisor before making any investment decision in United Cooperative Insurance Company's shares or any other insurance company. An advisor helps analyze financial data, assess risks, and develop an investment strategy suitable for each investor's personal and financial goals.