Riyadh – Mubasher: Moody's Investors Service (Moody's) has assigned a Baa2 insurance financial strength rating (IFSR) to Malath Cooperative Insurance Company, with a stable outlook.

The rating reflects the insurance firms’ good market position and brand, as the eleventh largest player in the Saudi Arabian insurance market, with a 2.1% market share in terms of gross premium written last year, according to a report by Moody's on Wednesday.

The Baa2 rating was attributed to the company’s strong asset quality, driven by a conservative investment strategy with low high-risk assets (HRA) as a percentage of consolidated equity of 7.7%, as well as a good capital adequacy level, with gross underwriting leverage (GUL) of 2.3x in 2018.

However, these strengths are partially constrained by the increasingly competitive Saudi Arabian property and insurance market, the report noted.

The ratings agency further noted that the stable rating outlook reflects its expectation that Malath will improve profitability and will grow its business with underwriting discipline thereby further strengthening its capital adequacy.