Abu Dhabi National Insurance Company (ADNIC) recorded a net loss of AED280 million in 2014 in contrast to a net profit of AED156 million in 2013, due to high-value losses in traditionally profitable lines of business.
Net underwriting loss for 2014 was AED157 million, compared to a net underwriting profit of AED266 million in 2013. Net investment income, however, increased by 7% to AED106 million for 2014 compared to AED100 million in 2013.
GWP grow by 9.1% y-o-y to AED2.63 billion (US$716 million) last year. CEO Ahmad Idris said this was largely driven by growth in commercial lines. However, “the traditionally profitable property, marine, and aviation lines of business were negatively impacted by losses, which, although low in frequency, were high in value. Within consumer lines, while ADNIC is taking firm action to realign the motor and medical portfolios, the 2014 results reflect the servicing of the run-off loss-making portfolios.”
Mr Idris added: “During 2014, ADNIC undertook a series of initiatives, which position the company well to prosper within the emerging economic background and the new regulatory framework in which we operate bringing greater stability, transparency, and healthier competition to a more sustainable UAE insurance industry.
“Our continued commitment to service, product and innovation remains central to our business strategy. Aligned to our selective and prudent underwriting practices, I am confident that this strategy will return ADNIC to sustained profitability and shareholder value in 2015 and beyond.”
Mr Khalifa Mohamed Al-Kindi, ADNIC Chairman, said: “Despite significant challenges in 2014, ADNIC has made progress on a number of strategic fronts that will lay the foundations for the future growth of the Company. The board of directors, as well as the management team, remain fully focussed on delivering growth and shareholder value.”
He added: “ADNIC’s performance will be driven by a new leadership that will steer the company towards operational, commercial and strategic improvements.”
The company appointed Mr Idris as its new CEO last December.
AED1 = US$0.27