Union Insurance Company has taken steps to strengthen its financial position, according to a corporate statement.
The insurer has decided to offset accumulated losses by reducing its capital to AED230m ($62.6m) from AED330m. The Abu Dhabi Securities Exchange announced on 25 June 2025 that the trading company's shares had been suspended in connection with this matter. Trading is scheduled to resume on Monday, 30 June.
After the reduction, the company will continue to maintain a capital that is more than double the minimum required for insurance companies, according to Central Bank regulations. Furthermore, Union Insurance’s solvency and liquidity continue to be strong. Recently, its solvency ratio reached 144%, according to the company's latest disclosure. The reduction will strengthen the company’s financial position, and ability to compete in the insurance market.
The reduction will be executed by utilising AED41.81m from reserves, including AED21.85m from the statutory reserve and AED19.95m from the legal reserve. The remaining AED100.94m will be written off by cancelling a corresponding number of shares equal to this amount.
Improved results
Union Insurance has reported a significant improvement in its financial results, achieving net profits of AED38.3m in 2024, compared to a loss of AED2.5m in 2023. The announced results for the first quarter of this year also reflect a positive indication of the company's continued success.
Mr Ramez Abou Zaid, CEO of Union Insurance, expressed his optimism about the company's positive results for 2025, reflecting its continued success and progress.
The company decided to appoint Fitch Ratings as its designated financial rating agency. Fitch has assigned the company its first-ever Financial Strength Rating (IFS) of "BBB" with a positive outlook, reflecting the strength of Union Insurance's balance sheet, the efficiency of its operational performance, and its reinsurance support.
Established in 1998 and listed on the Abu Dhabi Securities Exchange, Union Insurance is regulated by the UAE Central Bank and has a paid-up capital of over AED330m. The company provides a wide range of individual and commercial insurance products to clients in the UAE and the wider Middle East.