AM Best has affirmed the Financial Strength Ratings of A (Excellent) and the Long-Term Issuer Credit Ratings of “a” (Excellent) of Gulf Insurance Group K.S.C.P. (GIG) and Gulf Insurance and Reinsurance Company K.S.C. (Closed) (GIG-Kuwait) (both domiciled in Kuwait). The outlook of these Credit Ratings (ratings) is stable.

The ratings reflect GIG’s consolidated balance sheet strength, which AM Best assesses as very strong, as well as its strong operating performance, neutral business profile and appropriate enterprise risk management.

GIG-Kuwait is a composite insurer with a leading position in Kuwait’s insurance market. The company is strategically important to GIG and highly integrated into its operations.

GIG’s balance sheet is underpinned by consolidated risk-adjusted capitalisation at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR), and benefits from a comprehensive reinsurance programme and a relatively conservative investment strategy. Whilst the balance sheet is leveraged moderately following GIG’s acquisition of AXA Insurance (Gulf) B.S.C. (c) and AXA Cooperative Insurance Company (since rebranded known as Gulf Insurance Group (Gulf) B.S.C. (c) [GIG Gulf] and Gulf Insurance Group [A Saudi Joint Stock Company]), the group has plans to reduce its borrowing over the medium term. AM Best expects that GIG will maintain risk-adjusted capitalisation comfortably above the threshold for the strongest assessment.

GIG is amongst the largest and most diversified insurance groups in the Middle East and North Africa region, and its footprint has been extended further following its acquisition of GIG Gulf in 2021. GIG now holds market-leading positions in Kuwait, Jordan and Bahrain, and is a top five player in Saudi Arabia, the United Arab Emirates, Qatar, Oman, Egypt, Turkey and Algeria. In 2022, following the full consolidation of GIG Gulf, the groups premium revenue is expected to reach approximately USD 2.5 billion.

The group has a record of strong operating performance, returning a five-year (2017-2021) average return on equity of 16.3%, supported by a track record of positive underwriting performance, with an average combined ratio of 96.0% for the five-year period ending 2021. GIG’s return on equity increased in 2021 to 23.6% (2020: 14.3%), largely driven by a one off accounting gain from the acquisition of GIG Gulf.

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