Abu Dhabi National Takaful Company (ADNTC) has a record of sound underwriting profitability, with an average combined ratio of 90% over the past five years, notes Fitch Ratings.
The company’s combined ratio strengthened to 82% at the end of the third quarter of 2025, from 87% at end-2024, supported by continued pricing and underwriting discipline.
Fitch expects ADNTC’s annualised return on equity (ROE) to have remained close to 20% at end-2025 (end-2024: 18%). However, intense competition in the UAE insurance market and a higher frequency of natural catastrophe claims remain key risks.
Rating affirmed
Fitch has affirmed ADNTC’s Insurer Financial Strength (IFS) Rating at 'A-'. The Outlook is ‘Stable’. The rating reflects the insurer's moderate size in the UAE insurance market, its very strong capitalisation and strong profitability.
Aside from profitability, the key drivers of ADNTC’s rating include:
Moderate-Sized UAE Takaful Insurer: ADNTC's business profile reflects its good competitive positioning, business risk profile and diversification in the UAE market. Insurance revenue increased to AED757m ($206m) at end-2024 (2023: AED672m), although it was below the market average amid intense competition as the company prioritised profitability over growth. As a result, ADNTC's market ranking by insurance revenue declined slightly to the 13th largest in the UAE, from the 12th in 2023.
ADNTC maintains a diversified product offering across personal and commercial segments, including takaful P&C as well as family and health takaful. It has also broadened its underwriting capabilities in recent years by adding lines such as energy and aviation.
Very Strong Capitalisation, No Leverage: Fitch views ADNTC's capitalisation and leverage as a rating strength. ADNTC's Prism Global score remained 'Extremely Strong' at end-2024, improving within the category, and Fitch expects it to have remained unchanged at end-2025. The company reported a regulatory capital ratio of 270% at end-9M25 under the Central Bank of the UAE's methodology, although it was down from an exceptionally high 346% at end-2024. ADNTC has no financial leverage, which Fitch views as positive for the rating.
Prudent Investment Portfolio: ADNTC maintains a prudent investment portfolio, with most investments held in liquid assets. Cash and term deposits were 58% of ADNTC's investment portfolio at end-2024 (end-2023: 57%). ADNTC has gradually increased its exposure to other asset classes, including real estate, commodities and sukuk; Fitch expects the latter to benefit from higher reinvestment yields over the medium-to-long term. Fitch continues to view ADNTC's investment policy as prudent, as most sukuk holdings are rated investment-grade.
Adequate Reserving: ADNTC's reserve adequacy is supported by regular reserve valuations, which are reviewed by external actuaries. In addition, external auditors assess the reserving position as part of the annual audit, and the company is subject to regulatory audits by the CBUAE.
Strong Reinsurance Panel: ADNTC makes significant use of reinsurance across all lines of business. Its reinsurance panel includes large, globally diversified reinsurers. Most reinsurers are rated 'A' or higher, and all are rated at least 'A-'.