	English [member]
Start Date	2020-07-01	2019-07-01
End Date	2020-09-30	2019-09-30
Filing information [line items]
Disclosure of entity information [abstract]
Name of reporting entity	Malath Cooperative Insurance Co.
Company symbol code\| ISIN code	8020 \| SA000A0MJ2J4
Sector\| Industry group	Financials \| Insurance
Disclosure of document information [abstract]
Whether entity wants to report opening statement of financial position	No
Period covered by financial statements	Quarter 3
Reporting period start date	2020-07-01	2019-07-01
Reporting period end date	2020-09-30	2019-09-30
Description of nature of financial statements	Consolidated
Status of financial statements	Reviewed
Description of presentation currency	Saudi Arabia, Riyals
Level of rounding used in financial statements	Thousands

	Primary auditor [member]	Second primary auditor [member]
	English [member]	English [member]
Start Date	2020-07-01	2020-07-01
End Date	2020-09-30	2020-09-30
Auditors information [line items]
Details of auditors signing report [abstract]
Name of auditor signing report	Ibrahim Ahmad Albassam	Abdullah M. Al Azem
Registration number of auditor	337	335
Details of audit firm [abstract]
Name of audit firm	Al-Bassam & Co. Allied Accountants.	Al Azem, Al Sudairy, Al Shaikh & Partners
Registration number of audit firm	337	335
Contact number of audit firm	011 206 5333	112780608
Address of audit firm	P. O. Box 69658Riyadh 11557	P. O. Box 10504Riyadh 11443

	English [member]
Start Date	2020-07-01
End Date	2020-09-30
Auditors report [line items]
Disclosures of auditors report [text block]	INDEPENDENT AUDITOR’S REVIEW REPORT ON THE INTERIM CONDENSED FINANCIAL STATEMENTS TO THE SHAREHOLDERS OF MALATH COOPERATIVE INSURANCE COMPANY (A SAUDI JOINT STOCK COMPANY) INTRODUCTION We have reviewed the accompanying interim condensed statement of financial position of Malath Cooperative Insurance Company (the “Company”) as at 30^thSeptember 2020 and the related interim condensed statement of income and other comprehensive income for the three-month and nine-month periods then ended, and the interim condensed statement of changes in equity and interim condensed statement cash of flows for the nine-month period then ended, and a summary of significant accounting policies and other explanatory notes (the “interim condensed financial statements”). Management is responsible for the preparation and presentation of these interim condensed financial statements in accordance with International Accounting Standard 34 - “Interim Financial Reporting” (“IAS 34”) that is endorsed in the Kingdom of Saudi Arabia. Our responsibility is to express a conclusion on these interim condensed financial statements based on our review. SCOPE OF REVIEW We conducted our review in accordance with International Standard on Review Engagement 2410, “Review of Interim Financial Information Performed by the Independent Auditor of the Entity”, that is endorsed in the Kingdom of Saudi Arabia. A review of interim condensed financial statements consists of making inquiries, primarily of persons responsible for financial and accounting matters and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing that are endorsed in the Kingdom of Saudi Arabia and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion. CONCLUSION Based on our review, nothing has come to our attention that causes us to believe that the accompanying interim condensed financial statements is not prepared, in all material respects, in accordance with IAS 34 that is endorsed in the Kingdom of Saudi Arabia.
Contents of auditors report [abstract]
Nature of auditors opinion	Unmodified opinion
Auditors opinion	Based on our review, nothing has come to our attention that causes us to believe that the accompanying interim condensed financial information is not prepared, in all material respects, in accordance with IAS 34, as endorsed in the Kingdom of Saudi Arabia.
Date of signing audit report by auditor	2020-11-09

Start Date	2020-01-01	2019-01-01	2019-01-01
End Date	2020-09-30	2019-12-31	2019-09-30
Statement of financial position [abstract]
Assets [abstract]
Insurance/ takaful operations assets [abstract]
Property and equipment, net, insurance/ takaful operations assets	2,370	3,338	3,341
Deferred policy acquisition costs	19,747	27,331	29,412
Reinsurers/ retakaful share of unearned premiums/ contributions	24,421	17,538	26,019
Prepayments and other assets, insurance/ takaful operations assets	66,438	36,771	29,562
Premiums/ insurance receivables/takaful contributions receivable, net	191,885	183,834	192,050
Reinsurers/ retakaful share of outstanding claims/ benefits, net	131,948	147,703	91,830
Time (Murabaha) deposits, insurance/ takaful operations assets	427,000	360,000	360,000
Available-for-sale investments, insurance/ takaful operations assets	53,394	3,372	3,372
Cash and cash equivalents, insurance/ takaful operations assets	8,687	98,970	93,946
Total insurance/ takaful operations assets	925,890	878,857	829,532
Shareholders assets [abstract]
Statutory deposit	75,000	75,000	75,000
Prepayments and other assets, shareholders assets	16,862	13,597	9,425
Time (Murabaha) deposits, shareholders assets	165,206	280,000	38,000
Available-for-sale investments, shareholders assets	90,499	32,815	23,751
Due from insurance/ takaful operations assets	168	28,637	17,794
Cash and cash equivalents, shareholders assets	157,760	71,300	320,566
Total shareholders assets	505,495	501,349	484,536
Total assets	1,431,385	1,380,206	1,314,068
Liabilities and equity [abstract]
Insurance/ takaful operations liabilities and surplus (deficit) [abstract]
Insurance/ takaful operations liabilities [abstract]
Gross unearned premiums/ contributions	365,937	348,546	351,448
Unearned commission income	5,909	4,801	6,299
Surplus distribution payable	6,923	8,821	9,657
Due to shareholders operations	168	28,637	17,794
Due to related parties, insurance/ takaful operations liabilities	2	2	1
Reinsurers/ retakaful balance payable	33,494	11,248	29,331
Gross outstanding claims/ benefits including IBNR payable	311,476	318,463	266,102
Other technical reserves	45,940	20,919	25,929
Accrued expenses payable, insurance/ takaful operations liabilities	161,081	142,460	127,302
Total insurance/ takaful operations liabilities	930,930	883,897	833,863
Insurance/ takaful operations surplus (deficit) [abstract]
Surplus (deficit) from insurance/ takaful fund	0	0	0
Other insurance/ takaful operations surplus (deficit)	0	0	0
Total insurance/ takaful operations surplus (deficit)	0	0	0
Total insurance/ takaful operations liabilities and surplus (deficit)	930,930	883,897	833,863
Shareholders liabilities and equity [abstract]
Shareholders liabilities [abstract]
Zakat payable	30,875	32,220	27,587
Accrued expenses payable, shareholders liabilities	536	536	538
Other liabilities, shareholders liabilities	9,325	8,124	7,577
Total shareholders liabilities	40,736	40,880	35,702
Shareholders equity [abstract]
Equity attributable to owners of parent [abstract]
Share capital	500,000	500,000	500,000
Statutory reserve	2,131	2,131	2,131
Fair value reserve on investments, shareholders equity	4,204	634	85
Retained earnings (accumulated losses)	-41,576	-42,296	-53,382
Other reserves	-5,040	-5,040	-4,331
Total equity attributable to owners of parent	459,719	455,429	444,503
Non-controlling interests	0	0	0
Total equity attributable to equity holders of company	459,719	455,429	444,503
Total shareholders liabilities and equity	500,455	496,309	480,205
Total insurance/ takaful operations liabilities, surplus (deficit) and shareholders liabilities and equity	1,431,385	1,380,206	1,314,068

Start Date	2020-07-01	2019-07-01	2020-01-01	2019-01-01
End Date	2020-09-30	2019-09-30	2020-09-30	2019-09-30
Statement of insurance/ takaful operations [abstract]
Statement of insurance/ takaful operations and accumulated surplus (deficit) [abstract]
Income from insurance/ takaful operations [abstract]
Net premiums/ contributions earned [abstract]
Net premiums/ contributions written [abstract]
Gross premiums/ contributions written	153,611	154,332	617,021	636,459
Excess of loss expense	3,677	3,887	13,388	14,501
Reinsurance/ retakaful premiums ceded	8,062	8,424	58,545	61,437
Net premiums/ contributions written	141,872	142,021	545,088	560,521
Changes in unearned premiums/ contributions	-40,122	-19,241	10,508	77,599
Net premiums/ contributions earned	181,994	161,262	534,580	482,922
Reinsurance/ retakaful commissions	3,731	4,815	12,756	12,377
Investment income from insurance/ takaful operations, net	2,491	3,642	7,194	10,353
Fees and other income from insurance/ takaful operations	1,065	1,187	4,572	2,947
Total income from insurance/ takaful operations	189,281	170,906	559,102	508,599
Cost and expenses [abstract]
Net claims/ benefits incurred [abstract]
Net claims/ benefits paid [abstract]
Gross claims/ benefits paid	186,865	123,266	429,640	395,496
Reinsurance/ retakaful share of gross claims/ benefits paid	21,744	4,243	34,401	18,632
Net claims/ benefits paid	165,121	119,023	395,239	376,864
Changes in outstanding claims/ benefits including IBNR	-15,904	11,224	-10,401	32,577
Changes in other technical reserves	7,126	-387	44,190	-46,497
Net claims/ benefits incurred	156,343	129,860	429,028	362,944
Policy acquisition costs	16,398	18,166	53,004	50,848
General and administrative expenses, insurance/ takaful operations	27,903	26,785	80,281	82,798
Other underwriting income	633		1,898
Other cost and expenses	-4,448	-8,895	-1,020	14,679
Total cost and expenses	195,563	165,916	559,395	511,269
Surplus (deficit) for period from insurance/ takaful operations	-6,282	4,990	-293	-2,670
Shareholders appropriation from insurance/ takaful operations surplus (deficit)	-6,282	4,491	-293	-2,670
Net result for period from insurance/ takaful operations after shareholders appropriation	0	499	0	0
Policyholders share of accumulated surplus, at end of period	0	499	0	0

Start Date	2020-07-01	2019-07-01	2020-01-01	2019-01-01
End Date	2020-09-30	2019-09-30	2020-09-30	2019-09-30
Statement of shareholders operations [abstract]
Profit (loss) [abstract]
Income (loss) from continuing operations [abstract]
Shareholders appropriation of surplus (deficit) transferred from insurance/ takaful operations	-6,282	4,491	-293	-2,670
Revenue [abstract]
Investment income	7,761	2,055	14,709	7,766
Total revenue	7,761	2,055	14,709	7,766
Expenses [abstract]
General and administrative expenses, shareholders operations	175	237	3,796	2,450
Total expenses	175	237	3,796	2,450
Income (loss) from continuing operations before zakat and income tax	1,304	6,309	10,620	2,646
Zakat expenses on continuing operations for period	3,300	1,950	9,900	8,550
Profit (loss) from continuing operations	-1,996	4,359	720	-5,904
Income (loss) from discontinued operations [abstract]
Income (loss) from discontinued operations	0	0	0	0
Profit (loss) from discontinued operations before zakat and income tax	0	0	0	0
Profit (loss) from discontinued operations	0	0	0	0
Profit (loss) for the period	-1,996	4,359	720	-5,904
Profit (loss), attributable to [abstract]
Profit (loss), attributable to saudi shareholders of company	-1,996	4,359	720	-5,904
Earnings per share [abstract]
Basic earnings (loss) per share [abstract]
Basic earnings (loss) per share from continuing operations	-0.0399	0.0872	0.0144	-0.1181
Total basic earnings (loss) per share	-0.0399	0.0872	0.0144	-0.1181
Diluted earnings (loss) per share [abstract]
Diluted earnings (loss) per share from continuing operations	-0.0399	0.0872	0.0144	-0.1181
Total diluted earnings (loss) per share	-0.0399	0.0872	0.0144	-0.1181
Weighted average number of equity shares outstanding	50000	50000

Start Date	2020-07-01	2019-07-01	2020-01-01	2019-01-01
End Date	2020-09-30	2019-09-30	2020-09-30	2019-09-30
Statement of other comprehensive income, before tax [abstract]
Net result for period from insurance/ takaful operations after shareholders appropriation	0	499	0	0
Other comprehensive income [abstract]
Components of other comprehensive income that will not be reclassified to profit or loss [abstract]
Gains (losses) on revaluation of property and equipment	0	0
Total other comprehensive income that will not be reclassified to profit or loss	0	0
Components of other comprehensive income that will be reclassified to profit or loss [abstract]
Cash flow hedges [abstract]
Gains (losses) on cash flow hedges, net	0	0
Total other comprehensive income (loss), cash flow hedges	0	0
Available-for-sale financial assets [abstract]
Gains (losses) on remeasuring available-for-sale financial assets	0	0	0	0
Total other comprehensive income (loss), available-for-sale financial assets	0	0	0	0
Hedges of net investment in foreign operations [abstract]
Other comprehensive income, hedges of net investment in foreign operations	0	0
Total other comprehensive income (loss), hedges of net investment in foreign operations	0	0
Other comprehensive gains (losses) that will be reclassified to profit or loss	0	0
Total other comprehensive income (loss), that will be reclassified to profit or loss	0	0	0	0
Total other comprehensive income (loss)	0	0	0	0
Total comprehensive income (loss) for period	0	499	0	0

Start Date	2020-07-01	2019-07-01	2020-01-01	2019-01-01
End Date	2020-09-30	2019-09-30	2020-09-30	2019-09-30
Statement of other comprehensive income, before tax [abstract]
Statement of comprehensive income [abstract]
Profit (loss) for the period	-1,996	4,359	720	-5,904
Other comprehensive income [abstract]
Components of other comprehensive income that will be reclassified to profit or loss [abstract]
Available-for-sale financial assets [abstract]
Gains (losses) on remeasuring available-for-sale financial assets	2,518	0	3,570	316
Total other comprehensive income (loss), available-for-sale financial assets	2,518	0	3,570	316
Total other comprehensive income (loss), that will be reclassified to profit or loss	2,518	0	3,570	316
Total other comprehensive income (loss)	2,518	0	3,570	316
Total comprehensive income (loss) for period	522	4,359	4,290	-5,588
Total comprehensive income (loss) attributable to [abstract]
Total comprehensive income (loss), attributable to saudi shareholders of company	522	4,359	4,290	-5,588
Total comprehensive income (loss), attributable to non-saudi shareholders of company	0	0	0	0
Total comprehensive income (loss), attributable to non-controlling interests	0	0	0	0

Start Date	2020-01-01	2019-01-01
End Date	2020-09-30	2019-09-30
Statement of cash flows, indirect method [abstract]
Statement of cash flows, insurance/ takaful operations [abstract]
Cash flows from (used in) operating activities, insurance/ takaful operations [abstract]
Net result for period from insurance/ takaful operations after shareholders appropriation	0	0
Adjustments to reconcile net income to net cash from insurance/ takaful operations after shareholders appropriation
Adjustments for depreciation, insurance/ takaful operations cash flow	1,289	1,415
Adjustments for employees end of service benefits	3,355	2,464
Adjustments for allowance for doubtful receivables	-1,020	14,679
Adjustments for impairment (reversal of impairment) charges for available-for-sale investments	0	-50
Total adjustments to reconcile net income to net cash from insurance/ takaful operations after shareholders appropriation	3,624	18,508
Changes in operating assets and liabilities [abstract]
Adjustments for decrease (increase) in premium receivables, net	-7,031	-34,363
Adjustments for decrease (increase) in prepayments and other assets	-27,898	-8,647
Adjustments for increase (decrease) in outstanding claims including IBNR	-6,987	-5,443
Adjustments for increase (decrease) in reinsurers/ retakaful balance payable	22,246	24,065
Adjustments for increase (decrease) in accrued expenses and other liabilities	15,907	-34,896
Adjustments for decrease (increase) in reinsurers/ retakaful share of outstanding claims, net	15,755	-6,097
Adjustments for decrease (increase) in deferred policy acquisition costs	7,584	-8,354
Adjustments for decrease (increase) in deferred excess of loss expense	-1,769	-2,719
Adjustments for decrease (increase) in unearned commission income	1,108	1,830
Adjustments for increase (decrease) in due to shareholders operations	-28,469	5,592
Adjustments for movement in gross unearned premiums/ contributions	17,391	84,428
Adjustments for reinsurance/ retakaful share of unearned premiums/ contributions	-6,883	-6,829
Adjustment for changes in other technical reserves	411	-2,423
Adjustment for changes in other reserves	24,610	43
Adjustments for other changes in operating assets and liabilities, insurance/ takaful operations cash flow	-641	-1,364
Total changes in operating assets and liabilities	25,334	4,823
Net cash flows from (used in) insurance/ takaful operations	28,958	23,331
Other inflows (outflows) of cash classified as operating activities, insurance/ takaful operations cash flow	-1,898	-164
Net cash flows from (used in) operating activities, insurance/ takaful operations	27,060	23,167
Cash flows from (used in) investing activities, insurance/ takaful operations [abstract]
Time (Murabaha) deposits, insurance/ takaful operations cash flow	-67,000	5,349
Purchase of property and equipment, insurance/ takaful operations cash flow	321	922
Other inflows (outflows) of cash classified as investing activities, insurance/ takaful operations cash flow	-50,022	0
Net cash flows from (used in) investing activities, insurance/ takaful operations	-117,343	4,427
Cash flows from (used in) financing activities, insurance/ takaful operations [abstract]
Adjustments for decrease (increase) in due from shareholders operations	0	0
Adjustments for increase (decrease) in due to shareholders operations	0	0
Net cash flows from (used in) financing activities, insurance/ takaful operations	0	0
Increase (decrease) in cash and cash equivalents before effect of exchange rate changes	-90,283	27,594
Net increase (decrease) in cash and cash equivalents	-90,283	27,594
Cash and cash equivalents at beginning of period	98,970	66,352
Cash and cash equivalents at end of period	8,687	93,946

Start Date	2020-01-01	2019-01-01
End Date	2020-09-30	2019-09-30
Statement of cash flows, indirect method [abstract]
Statement of cash flows [abstract]
Cash flows from (used in) operating activities [abstract]
Net profit (loss) for period [abstract]
Income (loss) from continuing operations before zakat and income tax	10,620	2,646
Profit (loss) from discontinued operations before zakat and income tax	0	0
Net profit (loss) for period (before zakat expenses and income tax)	10,620	2,646
Adjustments to reconcile profit (loss) [abstract]
Adjustments for realised loss (gain) on available-for-sale investments, shareholders cash flow	-3,729
Adjustments for impairment (reversal of impairment) charges for investments, shareholders cash flow	0	-1,136
Total adjustments to reconcile profit (loss)	-3,729	-1,136
Changes in operating assets and liabilities [abstract]
Adjustments for increase (decrease) in accrued expenses and other liabilities, shareholders cash flow	0	2
Adjustments for decrease (increase) in due from insurance/ takaful operations	28,469	-5,592
Adjustments for decrease (increase) in prepayments and other assets, shareholders assets	-2,064	2,684
Total changes in operating assets and liabilities	26,405	-2,906
Net cash flows from (used in) operations	33,296	-1,396
Zakat expenses	11,245	10,829
Net cash flows from (used in) operating activities	22,051	-12,225
Cash flows from (used in) investing activities [abstract]
Purchase of available-for-sale investments	74,009	0
Proceeds from disposal of available-for-sale investments	23,624	10,000
Purchase of term deposits investments	-114,794	-275,000
Net cash flows from (used in) investing activities	64,409	285,000
Cash flows from (used in) financing activities [abstract]
Proceeds from issuing shares	0	0
Due to reinsurance/ retakaful operations	0	0
Payment of transaction costs	0	0
Net cash flows from (used in) financing activities	0	0
Increase (decrease) in cash and cash equivalents before effect of exchange rate changes	86,460	272,775
Net increase (decrease) in cash and cash equivalents	86,460	272,775
Cash and cash equivalents at beginning of period	71,300	47,791
Cash and cash equivalents at end of period	157,760	320,566

[400100] Notes forming part of accounts

English [member]

Note No.

Start Date

2020-07-01

End Date

2020-09-30

Notes forming part of accounts [line items]

Disclosure of notes and other explanatory information [text block]

1	ORGANIZATION AND PRINCIPAL ACTIVITIES

Malath Cooperative Insurance Company (the “Company”) is a Saudi Joint Stock Company established in Riyadh, Kingdom of Saudi Arabia by Royal Decree Number M/60 and incorporated on 21 Rabi Al-Awal 1428H corresponding to 9 April 2007 under Commercial Registration No. 1010231787. The Company’s head office is situated at Mohammad Bin Abdelaziz Street, P.O. Box 99763, Riyadh 11625, and Kingdom of Saudi Arabia.





The objectives of the Company are to engage in providing insurance and related services in accordance with its by-laws and the applicable regulations in the Kingdom of Saudi Arabia (KSA).


2	BASIS OF PREPARATION

(a)	Basis of presentation and measurement
These interim condensed financial information (interim condensed financial statements) of the Company as at and for the period ended 30 September 2020 have been prepared in accordance with International Accounting Standard 34 Interim Financial Reporting (“IAS 34”), as endorsed in the Kingdom of Saudi Arabia by Saudi Organization for Certified Public Accountants (SOCPA).




These interim condensed financial statements are prepared under the going concern concept and the historical cost convention, except for the measurement at fair value of available-for-sale investments and employees' end of service benefits measured at present value of future obligations using projected unit credit method. The Company’s interim condensed statement of financial position is not presented using a current/non-current classification. However, the following balances would generally be classified as non-current: Available-for-sale investments, Property and equipment, Statutory deposit, Accrued income on statutory deposit, Employees' end-of-service benefits and Accrued commission income payable to Saudi Arabian Monetary Authority ("SAMA"). All other financial statement line items balances would generally be classified as current. The Company presents its interim condensed statement of financial position in order of liquidity. As required by the Law on Supervision of Co-operative Insurance Companies, the Company maintains separate books of accounts for Insurance Operations and Shareholders’ Operations and presents the interim condensed financial statements accordingly (Note 18). Assets, liabilities, revenues and expenses clearly attributable to either activity are recorded in the respective accounts. The basis of allocation of expenses from joint operations is determined and approved by the management and the Board of Directors.














The interim condensed statement of financial position, interim condensed statements of income, comprehensive income and cash flows of the insurance operations and shareholders operations which are presented in Note 18 of the interim condensed financial statements have been provided as supplementary financial information to comply with the requirements of the guidelines issued by SAMA implementing regulations and is not required under IFRSs as endorsed in KSA. SAMA implementing regulations requires the clear segregation of the assets, liabilities, income and expenses of the insurance operations and the shareholders operations. Accordingly, the interim condensed statements of financial position, interim condensed statements of income, interim condensed statement of comprehensive income and interim condensed statement of cash flows prepared for the insurance operations and shareholders operations as referred to above, reflect only the assets, liabilities, income, expenses and comprehensive gains or losses of the respective operations.











In preparing the Company-level interim condensed financial statements in compliance with IFRSs as endorsed in KSA, the balances and transactions of the insurance operations are amalgamated and combined with those of the shareholders’ operations. Inter-operation balances and transactions are eliminated in full during amalgamation. The accounting policies adopted for the insurance operations and shareholders operations are uniform for like transactions and events in similar circumstances.





The interim condensed financial statements does not include all of the information required for full annual financial statements and should be read in conjunction with the audited annual financial statements as at and for the year ended 31 December 2019.

Disclosure of general information about reporting entity [abstract]

Disclosure of general information about reporting entity [text block]

1	ORGANIZATION AND PRINCIPAL ACTIVITIES

Malath Cooperative Insurance Company (the “Company”) is a Saudi Joint Stock Company established in Riyadh, Kingdom of Saudi Arabia by Royal Decree Number M/60 and incorporated on 21 Rabi Al-Awal 1428H corresponding to 9 April 2007 under Commercial Registration No. 1010231787. The Company’s head office is situated at Mohammad Bin Abdelaziz Street, P.O. Box 99763, Riyadh 11625, and Kingdom of Saudi Arabia.





The objectives of the Company are to engage in providing insurance and related services in accordance with its by-laws and the applicable regulations in the Kingdom of Saudi Arabia (KSA).

Disclosure of basis of preparation of financial statements [text block]

2	BASIS OF PREPARATION

(a)	Basis of presentation and measurement
These interim condensed financial information (interim condensed financial statements) of the Company as at and for the period ended 30 September 2020 have been prepared in accordance with International Accounting Standard 34 Interim Financial Reporting (“IAS 34”), as endorsed in the Kingdom of Saudi Arabia by Saudi Organization for Certified Public Accountants (SOCPA).




These interim condensed financial statements are prepared under the going concern concept and the historical cost convention, except for the measurement at fair value of available-for-sale investments and employees' end of service benefits measured at present value of future obligations using projected unit credit method. The Company’s interim condensed statement of financial position is not presented using a current/non-current classification. However, the following balances would generally be classified as non-current: Available-for-sale investments, Property and equipment, Statutory deposit, Accrued income on statutory deposit, Employees' end-of-service benefits and Accrued commission income payable to Saudi Arabian Monetary Authority ("SAMA"). All other financial statement line items balances would generally be classified as current. The Company presents its interim condensed statement of financial position in order of liquidity. As required by the Law on Supervision of Co-operative Insurance Companies, the Company maintains separate books of accounts for Insurance Operations and Shareholders’ Operations and presents the interim condensed financial statements accordingly (Note 18). Assets, liabilities, revenues and expenses clearly attributable to either activity are recorded in the respective accounts. The basis of allocation of expenses from joint operations is determined and approved by the management and the Board of Directors.














The interim condensed statement of financial position, interim condensed statements of income, comprehensive income and cash flows of the insurance operations and shareholders operations which are presented in Note 18 of the interim condensed financial statements have been provided as supplementary financial information to comply with the requirements of the guidelines issued by SAMA implementing regulations and is not required under IFRSs as endorsed in KSA. SAMA implementing regulations requires the clear segregation of the assets, liabilities, income and expenses of the insurance operations and the shareholders operations. Accordingly, the interim condensed statements of financial position, interim condensed statements of income, interim condensed statement of comprehensive income and interim condensed statement of cash flows prepared for the insurance operations and shareholders operations as referred to above, reflect only the assets, liabilities, income, expenses and comprehensive gains or losses of the respective operations.











In preparing the Company-level interim condensed financial statements in compliance with IFRSs as endorsed in KSA, the balances and transactions of the insurance operations are amalgamated and combined with those of the shareholders’ operations. Inter-operation balances and transactions are eliminated in full during amalgamation. The accounting policies adopted for the insurance operations and shareholders operations are uniform for like transactions and events in similar circumstances.





The interim condensed financial statements does not include all of the information required for full annual financial statements and should be read in conjunction with the audited annual financial statements as at and for the year ended 31 December 2019.

2	BASIS OF PREPARATION (continued)

(b)	Functional and presentation currency
These interim condensed financial statements have been presented in Saudi Riyals (SR), which is also the functional currency of the Company. All financial information has been rounded off to the nearest thousand, unless otherwise stated.



(c)	Critical accounting judgments, estimates and assumptions
The preparation of the interim condensed financial statements requires the use of estimates and judgments that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the interim condensed financial statements and the reported amounts of revenues and expenses during the reporting period. Although these estimates and judgments are based on management’s best knowledge of current events and actions, actual results ultimately may differ from those estimates.





Estimates and judgments are continually evaluated and based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.


Following are the accounting judgments and estimates that are critical in preparation of these interim condensed financial statements:

i)	The ultimate liability arising from claims made under insurance contracts
The estimation of the ultimate liability arising from claims made under insurance contracts is the Company’s most critical accounting estimate. There are several sources of uncertainty that need to be considered in the estimate of the liability that the Company will ultimately pay for such claims. Estimates are made at the end of the reporting period both for the expected ultimate cost of claim reported and for the expected ultimate costs of Claims Incurred But Not Reported (“IBNR”). Liabilities for unpaid reported claims are estimated using the input of assessments for individual cases reported to the Company. At the end of each reporting period, prior year claim estimates are reassessed for adequacy and changes are made to the provision.







The provision for IBNR is an estimation of claims which are expected to be reported subsequent to the date of interim condensed statement of financial position, for which the insured event has occurred prior to the date of interim condensed statement of financial position. The primary technique adopted by management in estimating the cost of notified and IBNR claims, is that of using the past claims settlement trends to predict future claims settlement trends. A range of methods such as Chain Ladder Method, Bornhuetter-Ferguson Method and Expected Loss Ratio Method are used by the actuaries to determine these provisions. The actuary has also used a segmentation approach including analyzing cost per member per year for medical line of business. Underlying these methods are a number of explicit or implicit assumptions relating to the expected settlement amount and settlement patterns of claims.









ii)	Impairment of available-for-sale investments
The Company determines that investments are impaired when there has been a significant or prolonged decline in the fair values of the financial assets below its cost. The determination of what is ‘significant’ or ‘prolonged’ requires judgement. A period of 12 months or longer is considered to be prolonged and a decline of 30% from original cost is considered significant as per Company policy. In making this judgement, the Company evaluates, among other factors, the duration or extent to which the fair value of an investment is less than its cost.












10
2	BASIS OF PREPARATION (continued)

(c)	Critical accounting judgments, estimates and assumptions (continued)

iii)	Impairment of receivables
A provision for impairment of receivables is established when there is objective evidence that the Company will not be able to collect all amounts due according to the original terms of the receivables. Significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy or financial reorganization, and default or delinquency in payments are considered indicators that the receivable is impaired.





iv)	Fair value of financial instruments
Fair values of available-for-sale investments are based on quoted prices for marketable securities or estimated fair values. The fair value of commission-bearing items is estimated based on discounted cash flows using commission for items with similar terms and risk characteristics.



v)	Deferred policy acquisition costs
Certain acquisition costs related to sale of policies are recorded as deferred acquisition costs and are amortized over the related period of policy coverage. If the assumptions relating to future profitability of these policies are not realized, the amortization of these costs could be accelerated and this may also require additional impairment.




vi)	Premium deficiency reserve
Estimation of the premium deficiency reserve is highly sensitive to a number of assumptions as to the future events and conditions. It is based on an expected loss ratio for the unexpired portion of the risks for written policies. To arrive at the estimate of the expected loss ratio, the actuary looks at the claims and premiums relationship which is expected to be realized in the future.

Disclosure of summary of significant accounting policies [abstract]

Disclosure of summary of significant accounting policies, general comment [text block]

SIGNIFICANT ACCOUNTING POLICIES

The accounting policies adopted in the preparation of these interim condensed financial statements are consistent with those followed in the preparation of the Company’s annual financial statements for the year ended 31 December 2019, except for the adoption of new standards effective as of 1 January 2020. The Company has not early adopted any standard (interpretation) or amendments that has been issued but which are not yet effective.

Amendment to standards and interpretations

There are no new standards issued, however, certain amendments to standards and interpretations which are effective from 1 January 2020 and were listed in the Company's annual financial statements of 31 December 2019, but they do not have any impact on the interim condensed financial statements of the Company.

Standards issued but not yet effective

The Company has chosen not to early adopt the amendments and revisions to the IFRSs, which have been published and are mandatory for compliance for the Company with effect from future dates.

STANDARD/

INTERPRETATION/

AMENDMENTS

DESCRIPTION

EFFECTIVE FROM

PERIODS BEGINNING ON OR AFTER THE

FOLLOWING DATE

IFRS 9

Financial Instruments (refer below)

1-Jan-19

IFRS 17

Insurance Contracts (refer below)

1-Jan-23

IFRS 9 - Financial Instruments

The implementation of IFRS 9 is expected to result in a significant portion of financial assets currently classified as available-for-sale being re-classified as at fair value through profit or loss or fair value through other comprehensive income (OCI). Credit allowances for financial assets carried at amortized cost and debt securities measured at fair value, with changes in fair value recognized in OCI, are expected to increase due to the introduction of the expected credit loss methodology. The Company is using the exemptions available to insurers to defer the implementation of IFRS 9 until implementation of IFRS 17. The impact of the adoption of IFRS 9 on the Company’s interim condensed financial statements will, to a large extent, have to take into account the interaction with the IFRS 17 "Insurance contracts". At present the Company has not fully assessed the effects of adoption of IFRS 9.

IFRS 17 - Insurance Contracts

Overview

This standard has been published in May, 2017. It establishes the principles for the recognition, measurement, presentation and disclosure of insurance contracts and supersedes IFRS 4 – Insurance contracts.

The new standard applies to insurance contracts issued, to all reinsurance contracts and to investment contracts with discretionary participating features, provided the entity also issues insurance contracts. It requires to separate the following components from insurance contracts:

embedded derivatives, if they meet certain specified criteria;

ii-

distinct investment components; and

iii-

any promise to transfer distinct goods or non-insurance services.

Effective date

The effective date of IFRS 17 and the deferral of the IFRS 9 temporary exemption in IFRS 4 is currently for reporting periods beginning on or after January 1, 2023. This is a deferral of 2 year compared to the previous date of January 1, 2021. Earlier application is permitted if both IFRS 15 – Revenue from Contracts with Customers and IFRS 9 – Financial Instruments have also been applied. The Company intends to apply the Standard on its effective date.

Transition

Retrospective application is required. However, if full retrospective application for a group of insurance contracts is impracticable, then the entity is required to choose either a modified retrospective approach or a fair value approach.

Impact

The Company carried out assessment for ascertaining the impact of the application and implementation of IFRS 17 on results of the financial year 2018. The Company has also undertaken an initial operational impact gap analysis and currently undergoing through detailed operational and financial impact assessment along with working on planning and design phase to enable the Company to establish required system and processes under IFRS 17. Key gaps and their impact noted so far are as follows:

	Impact area			Summary of impact
	Financial impact			The assessment to ascertain the financial impact on reported balances of year 2018 resulted in significant increase in insurance related liabilities hence reducing the operating profits for initial years.
	Data impact			IFRS 17 has additional data requirements (e.g. premium due date for initial recognition, premium receipt data for the LFRC, RI contracts held break down into risk attaching or loss incurring for assessing contract boundaries, lower granularity to meet level of aggregation requirements and data for additional disclosures as per IFRS 17).
	IT systems impact			Detailed assessment needed of existing systems capabilities for IFRS 17 calculations, storage and reporting and whether new systems/calculation engines should be implemented.
	Process impact			The company carried out an operational impact assessment exercise to assess the operational impact of implementing IFRS 17. Since, majority of the company’s contracts would be measured under the premium allocation approach, the process impact is expected to be moderate.
	Impact on Reinsurance arrangements			Further assessment is needed to confirm measurement approach for reinsurance arrangements where RI gross premium ceded does not automatically qualify for PAA.
	Impact on policies and control frameworks			The Company's policies and procedures needs updation to accommodate the changes in the Company's processes and systems related to IFRS 17 implementation.

Description of accounting policy for time (murabaha) deposit [text block]

5	MURABAHA DEPOSITS

		30 September	31 December
		2020	2019
		(Unaudited)	(Audited)
		SR (000)
Insurance operations
Short term Murabaha deposits		427,000	360,000


Shareholders' operations
Short term Murabaha deposits		165,206	280,000
Total Murabaha deposits		592,206	640,000

Murabaha deposits have an original maturity of more than three months from the date of acquisition and are subject to an average commission rate of 3.06% per annum as at 30 September 2020 (31 December 2019: 3.24% per annum).



The carrying amounts disclosed above are not materially different from their fair values at the date of the interim condensed statement of financial position.

Disclosure of notes forming part of accounts [abstract]

Disclosure of investments in available-for-sale investments [text block]

8	AVAILABLE-FOR-SALE INVESTMENTS
		30 September	31 December
		2020	2019
		(Unaudited)	(Audited)
		SR (000)
Insurance operations
Unquoted
Funds		53,394	3,372

Shareholders’ operations
Quoted
Equity shares		20,110	9,380

Unquoted
Funds		68,466	21,512
Equity shares		1,923	1,923
		90,499	32,815
Total available for sale investments (note 14)		143,893	36,187
The fair values of the unquoted mutual funds computed above are based on the latest reported net assets as at the reporting date. Unquoted equity shares in shareholders' operations include investment in Najm Company for Insurance Services which is carried at cost due to absence of active market or other means of reliably measuring its fair value. An impairment review is performed at each reporting date.




Movement in the investments balance is as follows:		30 September	31 December
		2020	2019
		(Unaudited)	(Audited)
		SR (000)
Insurance operations
Balance at beginning of the period/year		3,372	3,322
Addition during the period/year		50,022	-
Reversal of impairment of investments during the period/year		-	50
Balance at end of the period/year		53,394	3,372

Shareholders' operations
Balance at beginning of the period/year		32,815	32,299
Addition during the period/year		74,009	8,516
Disposals during the period/year		(19,895)	(10,000)
Reversal of impairment during the period/year		-	1,135
Realized gain during the period/year		(3,729)	-
Re-measurement gain during the period/year		7,299	865
Balance at end of the period/year		90,499	32,815

Disclosure of premiums/ contributions and insurance/ reinsurance or takaful/ retakaful balance receivables [text block]

6	PREMIUMS AND REINSURERS' RECEIVABLE - NET
Receivables comprise amounts due from the following:
		30 September	31 December
		2020	2019
		(Unaudited)	(Audited)
		SR (000)

Policyholders		197,015	205,100
Reinsurers		11,344	349
Insurance companies		10,338	4,729
Agents and brokers		5,542	7,030
		224,239	217,208
Less:
Provision for doubtful receivables - insurance		(31,958)	(33,151)
Provision for doubtful receivables - reinsurers		(396)	(223)
		(32,354)	(33,374)
		191,885	183,834
The movement in the provision for doubtful receivables is as follows:
		30 September	31 December
		2020	2019
		(Unaudited)	(Audited)
		SR (000)

Balance at the beginning of the period/year		33,374	34,449
Provision / (reversals) made during the period/year		(1,020)	(1,075)
Balance at the end of the period/year		32,354	33,374

Disclosure of due from related parties [text block]

16	RELATED PARTY TRANSACTIONS AND BALANCES

Related parties represent major shareholders, directors and key management personnel of the Company, and companies of which they are principal owners and any other entities controlled, jointly controlled or significantly influenced by them. Pricing policies and terms of these transactions are mutually agreed and are approved by the Company’s management.





The following are the details of the major related party transactions during the period and the related balances:

		Nine-months period ended 30 September
		2020	2019
		(Unaudited)	(Unaudited)
		SR (000)


Remuneration paid to Board of Directors		3,210	1,750
Board of Directors’ and Committees meeting fees		303	114


Remuneration and compensation of key management personnel:

		Nine-months period ended 30 September
		2020	2019
		(Unaudited)	(Unaudited)
		SR (000)
Salaries and allowances		5,522	5,043
End of service indemnities		266	238
		5,788	5,281
Balances due from / (to) related parties comprise the following:

		30 September	31 December
		2020	2019
		(Unaudited)	(Audited)
		SR (000)

Claims payable to companies owned by BOD members		(2)	(2)

Disclosure of cash and cash equivalents [text block]

4	CASH AND CASH EQUIVALENTS

		30 September	31 December
		2020	2019
		(Unaudited)	(Audited)
		SR (000)
Insurance operations
Cash in banks		8,678	48,960
Cash on hand		9	10
Short term Murabaha deposits		-	50,000
		8,687	98,970

Shareholders' operations
Cash in banks		157,760	71,300
Total cash and cash equivalents		166,447	170,270

Short term Murabaha deposits have original maturity of less than three months from the date of acquisition and are subject to an average commission rate of 1.73% per annum as at 31 December 2019 per annum.


The carrying amounts disclosed above are not materially different from their fair values at the date of the interim condensed statement of financial position.

Disclosure of zakat [text block]

9	PROVISION FOR ZAKAT
a)	Zakat payable
The movement in zakat payable during the period/year was as follows:
		30 September	31 December
		2020	2019
		(Unaudited)	(Audited)
		SR (000)

Balance at beginning of the period/year		32,220	29,866
Charge for the period/year		9,900	13,183
Payments during the period/year		(11,245)	(10,829)
Balance at end of the period/year		30,875	32,220
b)	Status of assessments

The Company had filed the Zakat return for the years 2016 to 2018 and received a temporary Zakat certificate. No assessments have been received from GAZT to date in respect of these years. For the year 2019, the Company has filed the Zakat return before extended deadline of July 31, 2020 and received temporary Zakat certificate.




c)	Status of appeals

Zakat years 2007 to 2010: The GAZT raised its assessments for those years claiming additional zakat liability of Saudi Riyals 8.7 million and withholding tax liability of Saudi Riyals 12.2 million in addition to the related delay penalties of 1% for each 30 delay days calculated from the due date till settling such due amounts. The Company has filed an appeal against such additional liabilities to GAZT then the case has been transferred to the Preliminary Appeal Committee ("PAC") which has rejected the major items therefore the Company has submitted a letter of guarantee to GAZT for zakat, withholding tax and related delay penalties amounting to Saudi Riyals 31.81 million and appealed the PAC ruling to the Higher Appeal Committee ("HAC") which has been replaced by the new tax committees under General Secretary of Tax Committees ("GSTC"), and the committee's hearing is awaited.










Zakat years 2011 to 2015: The GAZT raised its assessments for those years claiming additional zakat liability of Saudi Riyals 8 million and withholding tax liability of Saudi Riyals 10.2 million in addition to the related delay penalties of 1% for each 30 delay days calculated from the due date till settling such due amounts. The Company has filed an appeal against such additional liabilities to GAZT then the case has been transferred to the Preliminary Appeal Committee ("PAC") which has been replaced by the new tax committees under General Secretary of Tax Committees ("GSTC"), and the committee's hearing is awaited.

Disclosure of classes of share capital [text block]

10	SHARE CAPITAL
As at 30 September 2020 and 31 December 2019, the issued and paid up share capital of the Company amounts to SR 500 million, divided into 50 million ordinary shares of SR 10 each.

Disclosure of statutory reserve [text block]

STATUTORY RESERVE

In accordance with the Company’s By-Laws and in compliance with Article 70(2)(g) of the Insurance Implementing Regulations issued by SAMA, the Company is required to allocate 20% of its net income for the year to the statutory reserve until it equals the value of share capital and such transfer is only made at year end. The statutory reserve is not available for distribution to shareholders until liquidation of the Company.

Disclosure of technical reserve for insurance/takaful/reinsurance/retakaful operations [text block]

7	TECHNICAL RESERVES

a)	Outstanding claims and reserves
		30 September	31 December
		2020		2019
		(Unaudited)		(Audited)
		SR (000)

Outstanding claims		119,823		140,569
Claims incurred but not reported at end of the period/year		191,653		177,894
Additional premium reserves		41,924		17,314
Other technical reserves		4,016		3,605
		357,416		339,382

Reinsurers' share of outstanding claims		(111,882)		(122,227)
Reinsurers' share of claims incurred but not reported		(20,066)		(25,476)
		(131,948)		(147,703)
Net outstanding claims and reserves		225,468		191,679

Disclosure of earnings per share [text block]

11	BASIC AND DILUTED EARNINGS PER SHARE

Basic and diluted earnings per share for the period have been calculated by dividing the total net income for the period by the weighted average number of shares in issue throughout the period.

The basic and diluted earning per share are as follows:
		Nine-months period ended 30 September
		2020	2019
		(Unaudited)	(Unaudited)

Basic and diluted earnings per share (Saudi Riyals)		0.01	(0.12)
Weighted average number of shares throughout the period (thousands)		50,000	50,000

Disclosure of entity's operating segments [text block]

17	SEGMENT INFORMATION
Consistent with the Company's internal reporting process, operating segments have been approved by management in respect of the Company's activities, assets and liabilities as stated below. Segment results do not include income from investments, income from Murabaha deposits, other income, general and administrative expenses, and provision for doubtful debts.




Segment results do not include commission on short-term Murabaha deposits. Segment assets do not include insurance operations’ cash and cash equivalents, Murabaha deposits, available for sale investments, premium and reinsurers' receivable net, prepayments and other assets and property and equipment. Accordingly, they are included in unallocated assets. Segment liabilities do not include reinsurance balances payable, policyholders claims payable, accrued and other liabilities, accumulated surplus and due to related parties. Accordingly, they are included in unallocated liabilities.





These unallocated assets and liabilities (including the related charges for provision for doubtful debts on premiums and reinsurers’ receivable and depreciation on the property and equipment) are not reported to Chief Executive Officer under related segments and are monitored on a centralized basis.

Disclosure of capital management [text block]

CAPITAL MANAGEMENT

Objectives are set by the Company to maintain healthy capital ratios in order to support its business objectives and maximize shareholders’ value.

The Company manages its capital requirements by assessing shortfalls between reported and required capital levels on a regular basis. Adjustments to current capital levels are made in light of changes in market conditions and risk characteristics of the Company’s activities. In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to shareholders or issue new shares.

The Company manages its capital to ensure that it is able to continue as going concern and comply with the regulators’ capital requirements of the markets in which the Company operates. The capital structure of the Company consists of equity attributable to equity holders comprising paid share capital and reserves.

As per guidelines laid out by SAMA in Article 66 of the Implementing Insurance Regulations detailing the solvency margin requirements, the Company shall maintain solvency margin equivalent to the highest of the following three methods as per SAMA Implementing Regulations:

Minimum Capital Requirement of SR 100 million

Premium Solvency Margin

Claims Solvency Margin

In the opinion of the Board of Directors, the Company has fully complied with the externally imposed capital requirements during the reported financial period.

Disclosure of commitments and contingencies, general [text block]

COMMITMENTS AND CONTINGENCIES

a. Legal proceedings and regulations

The Company operates in the insurance industry and is subject to legal proceedings in the normal course of business. While it is not practicable to forecast or determine the final results of all pending or threatened legal proceedings, management does not believe that such proceedings (including litigations) will have a material effect on its results and financial position for the current reporting period.

b. Contingent liabilities

The Company’s contingent liabilities are as follows:

30 September

31 December

2020

2019

(Unaudited)

(Audited)

SR (000)

Letters of guarantee

42,689

48,027

Above letters of guarantee include SR 31.81 million for zakat and withholding income tax submitted to General Authority of Zakat and Tax (GAZT) (note 9).

Disclosure of fair value of financial assets and liabilities [text block]

14	FAIR VALUE OF FINANCIAL INSTRUMENTS

The Company uses the following hierarchy for determining and disclosing the fair value of financial instruments:

Level 1: Quoted market prices in an active market (that are unadjusted) for identical assets or liabilities.

Level 2: Valuation techniques (for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable), and

Level 3: Valuation techniques (for which the lowest level input that is significant to the fair value measurement is unobservable).


The fair values of all other financial assets and liabilities which are carried at cost, are not significantly different from the carrying values included in these financial statements, since the current market commission rates for similar financial instruments are not significantly different from the contracted rates, and on account of the short duration of the assets and liabilities.



The following table summarizes the financial assets recorded at fair value as of 30 September 2020 and 31 December 2019 by level of the fair value hierarchy. There are no transfers among the levels during the period. Also refer to note 8.



As at 30 September 2020 (Unaudited)
		Carrying value	Level 1	Level 2	Level 3	Total
		SR (000)
Financial assets:
Available-for-sale investments
Insurance operations
Funds		53,394	-	53,394	-	53,394

Shareholders' operations
Equity securities		22,033	20,110	-	1,923	22,033
Funds		68,466	-	68,466	-	68,466
		143,893	20,110	121,860	1,923	143,893

As at 31 December 2019 (Audited)
		Carrying value	Level 1	Level 2	Level 3	Total
		SR (000)
Financial assets:
Available-for-sale investments
Insurance operations
Funds		3,372	-	3,372	-	3,372

Shareholders' operations
Equity securities		11,303	9,380	-	1,923	11,303
Funds		21,512	-	21,512	-	21,512
		36,187	9,380	24,884	1,923	36,187

Disclosure of board of director's approval of the financial statements [text block]

APPROVAL OF INTERIM CONDENSED FINANCIAL STATEMENTS

The interim condensed financial statements were approved by the Board of Directors on 15 Rabi Al-Awwal, 1442 H (corresponding to 01 November, 2020).

Disclosure of other notes relevant to understanding of financial statements [text block]

IMPACT OF COVID-19 OUTBREAK

On 11 March 2020, the World Health Organization (“WHO”) declared the Coronavirus (“COVID-19”) outbreak as a pandemic in recognition of its rapid spread across the globe. This outbreak has also affected the GCC region including the Kingdom of Saudi Arabia. Governments all over the world took steps to contain the spread of the virus. Saudi Arabia in particular has implemented closure of borders, released social distancing guidelines and enforced country wide lockdowns and curfews.

In response to the spread of the Covid-19 virus in the GCC where the Company operates and its consequential disruption to the social and economic activities in those markets, the Company’s management has proactively assessed its impacts on its operations and has taken a series of proactive and preventative measures and processes to ensure:

the health and safety of its employees and the wider community where it is operating

the continuity of its business throughout the Kingdom is protected and kept intact.

The major impact of Covid-19 pandemic is seen in motor line of business as explained below. As with any estimate, the projections and likelihoods of occurrence are underpinned by significant judgment and rapidly evolving situation and uncertainties surrounding the duration and severity of the pandemic, and therefore, the actual outcomes may be different to those projected. The impact of such uncertain economic environment is judgmental, and the Company will continue to reassess its position and the related impact on a regular basis.

Motor technical reserves

In response to the Covid-19 pandemic, SAMA issued a circular 189 (the “circular”) dated 08 May 2020 to all insurance companies in the Kingdom of Saudi Arabia. Amongst other things, the circular instructed insurance companies to extend the period of validity of all existing retail motor insurance policies by further two months as well as providing a two-month additional coverage for all new retail motor policies written within one month of this circular.

The Management, in conjunction with its appointed actuary, deliberated on a variety of internal factors and concluded, that the Company considers the extension of two months in exiting motor policies as new policy and record a premium deficiency reserve based on the expected claims for the extended 2 months period.

For new policies written as per above circular, the premium is earned over the period of coverage i.e. 14 month as per the Company accounting policy.

Financial assets

To cater for any potential impacts, the Covid-19 pandemic may have had on the financial assets of the Company, the Company has performed an assessment in accordance with its accounting policy, to determine whether there is an objective evidence that a financial asset or a group of financial assets has been impaired. For debt financial assets, these include factors such as, significant financial difficulties of issuers or debtors, default or delinquency in payments, probability that the issuer or debtor will enter bankruptcy or other financial reorganization, etc. In case of equities classified under available-for-sale, the Company has performed an assessment to determine whether there is a significant or prolonged decline in the fair value of financial assets below their cost.

Based on these assessments, the Company’s management believes that the Covid-19 pandemic has had no material effects on Company’s reported results for the three and nine-month periods ended 30 September 2020. The Company’s management continues to monitor the situation closely.

19-20

[100010] Filing information	[200100] Independent auditors report	[300100] Statement of financial position, order of liquidity
[300200] Statement of insurance/ takaful operations, nature of expense	[300300] Statement of shareholders operations, nature of expense	[300400] Statement of other comprehensive income, before tax, insurance operations
[300500] Statement of other comprehensive income, before tax, shareholders operations	[300600] Statement of cash flows, indirect method, insurance operations	[300700] Statement of cash flows, indirect method, shareholders operations
[300800] Statement of changes in equity	[400100] Notes forming part of accounts