Al Khaleej Takaful Insurance Company's (AKTI) operating performance as strong with the company reporting robust underwriting performance consistently, with a five-year (2020-2024) weighted average combined ratio (including short-term life results) of 83%, notes AM Best.
Al Khaleej Takaful Insurance Company’s (AKTI) operating performance is strong, with the company reporting robust underwriting performance consistently, with a five-year (2020-2024) weighted average combined ratio (including short-term life results) of 83%, notes AM Best.
Whilst underwriting performance worsened in 2025, with the company reporting a net/net combined ratio of 99% (2024: 86%) based on the new FAS 42 and 43 reporting standards, profitability is expected to improve in 2026, following management's corrective actions.
AKTI holds a niche position within its domestic insurance market, but has been steadily growing in recent years, evidenced by a compounded annual growth rate of 22% over the five-year period between 2020 and 2024. The company materially expanded its top line in 2024, in part as a result of a fronting arrangement signed with a leading international medical provider during the last quarter of 2023. The company continued growing its top line in 2025, recording QAR524m ($144m) of takaful contributions, up by 20% compared with 2024. Despite the good growth, AKTI has a relatively low product diversification, with its business mix mainly dominated by motor and medical lines on a net basis.
Ratings affirmed
AM Best has affirmed AKTI’s Financial Strength Rating of ‘A- ‘(Excellent) and a Long-Term Credit Rating of ‘a-’ (Excellent). The outlook of these credit ratings is ‘Stable’.
The ratings reflect AKTI’s balance sheet strength, which AM Best assesses as very strong, as well as its strong operating performance, limited business profile and appropriate enterprise risk management.
ME conflict
AM Best notes that the ongoing conflict in the region is evolving rapidly. At this stage, the conflict has not had a material impact on AKTI; however, AM Best says it will monitor the situation closely.
AKTI is a takaful insurer and operates through a hybrid model, whereby the shareholders’ fund charges the policyholders’ fund (PHF) a Wakala fee based on gross written contributions and a Mudarabah fee based on investment income.
Balance sheet strength
AKTI’s balance sheet strength is underpinned by its risk-adjusted capitalisation comfortably above the threshold for a strongest assessment, as measured by Best’s Capital Adequacy Ratio (BCAR). AM Best considers the company’s risk-adjusted capitalisation on a combined basis, including its policyholders’ and shareholders’ funds, due to the requirement that the shareholders’ fund would have to support the PHF if it were to fall into deficit.
Overall, despite its meaningful exposure to Qatari real estate, AKTI has a conservative and liquid investment portfolio, with cash and sukuk holdings covering Takaful arrangement liabilities net of Retakaful arrangement assets by 432% as at year-end 2025. An offsetting factor to the balance sheet strength assessment is the company’s moderately high reliance on reinsurance, which is partially mitigated by a reinsurance panel of excellent credit quality.