| Notes forming part of accounts [line items] | | |
| Disclosure of notes and other explanatory information [text block] | | |
| Disclosure of general information about reporting entity [abstract] | | |
| Disclosure of general information about reporting entity [text block] | Bupa Arabia for Cooperative Insurance Company (the “Company”) is a Saudi Joint Stock Company incorporated in the Kingdom of Saudi Arabia as per the Ministry of Commerce and Investment’s Resolution number 138/K dated 24 Rabi Thani 1429H (corresponding to 1 May 2008). The Commercial Registration number of the Company is 4030178881 dated 5 Jumad Awwal 1429H (corresponding to 11 May 2008). The Registered Office of the Company is situated at:Al-Khalediyah District,Prince Saud Al Faisal Street,Front of Saudi Airlines Cargo Building,P.O. Box 23807, Jeddah 21436,Kingdom of Saudi Arabia.The Company is licensed to conduct insurance business in the Kingdom of Saudi Arabia under cooperative principles in accordance with Royal Decree No. M/74 dated 29 Shabaan 1428H (corresponding to 11 September 2007) pursuant to the Council of Ministers’ Resolution No 279 dated 28 Shabaan 1428H (corresponding to 10 September 2007).The objective of the Company is to transact cooperative insurance operations and related activities in the Kingdom of Saudi Arabia in accordance with its articles of association, and applicable regulations in the Kingdom of Saudi Arabia. The Company underwrites medical insurance only.The Board of Directors approves the distribution of the surplus from insurance operations in accordance with the Implementing Regulations issued by the Saudi Arabian Monetary Authority (“SAMA”), whereby the shareholders of the Company are to receive 90% of the annual surplus from insurance operations and the policyholders are to receive the remaining 10%. Any deficit arising on insurance operations is transferred to the shareholders’ operations in full. | 1 |
| Disclosure of basis of preparation of financial statements [text block] | These financial statements have been prepared in accordance with International Financial Reporting Standards (IFRSs) as modified by SAMA for the accounting of zakat and income tax, which requires, adoption of all IFRSs as issued by the International Accounting Standards Board (“IASB”) except for the application of International Accounting Standard (IAS) 12 - “Income Taxes” and IFRIC 21 - “Levies” so far as these relate to zakat and income tax. As per the SAMA Circular no. 381000074519 dated April 11, 2017 and subsequent amendments through certain clarifications relating to the accounting for zakat and income tax (“SAMA Circular”), the zakat and income tax are to be accrued on a quarterly basis through equity under retained earnings.The financial statements are prepared under the going concern basis and the historical cost convention, except for the measurement at fair value of investments held at fair value through statement of income (FVSI), available for sale investments and measurement reserve of defined benefit obligation. The Company’s 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, fixtures, furniture and equipment, intangible assets, goodwill, statutory deposit, accrued income on statutory deposit, provision for end-of-service benefits and accrued income payable to SAMA. All other financial statement line items would generally be classified as current unless, stated otherwise. As required by the Saudi Arabian Insurance Regulations “the Implementation Regulations”, the Company maintains separate books of accounts for “Insurance Operations” and “Shareholders’ Operations”. Accordingly, assets, liabilities, revenues and expenses attributable to either operation are recorded in the respective accounts. The Company’s financial statements until 31 December 2017, presented separately the statement of financial position, statements of income, comprehensive income and cash flows of insurance and shareholders’ operations.During the current year, SAMA issued illustrative financial statements for the insurance sector in the Kingdom of Saudi Arabia. In preparing the Company level financial statements in compliance with IFRS as modified by SAMA, the balances and transactions of insurance operations are combined with those of shareholders’ operations. Inter-operation balances and transactions, if any, are eliminated in full. The accounting policies adopted for the insurance and shareholders’ operations are uniform for like transactions and events in similar circumstances. In preparing these financial statements comparative amounts are also combined to conform to the current year presentation in line with SAMA requirements, which has no impact on the previously reported net profit and retained earnings. However, note 37 to these financial statements provides the statement of financial position, statements of income, comprehensive income and cash flows of insurance and shareholders operations, separately. | 2A |
| Disclosure of new standards and amendments in standards [text block] | The following new standards, amendments and revisions to existing standards, which were issued by the International Accounting Standards Board (IASB) have been effective from 1 January 2018 and accordingly adopted by the Company, as applicable:Standard / AmendmentsDescriptionIFRS 2Amendments to IFRS 2 Classification and Measurement of share-based Payment transactions.IAS 40Amendments to IAS 40 Transfers of investment propertyIFRIC 22Foreign Currency Transactions and Advance considerationIFRS 15Revenue from Contracts with Customers (refer below)IFRS 1 and IAS 28Annual Improvements 2016 to IFRS 2014- 2016 cycle.The adoption of the amended standards and interpretations applicable to the Company did not have any significant impact on these financial statements.IFRS 15 – Revenue from Contracts with CustomersIFRS 15 outlines a single comprehensive model of accounting for revenue arising from contracts with customers and supersedes current revenue guidance, which is found currently across several Standards and Interpretations within the IFRS. IFRS 15 does not apply to “revenue from insurance contracts”. However, entities will need to apply IFRS 15 to non-insurance contracts (or components of insurance contracts).The Company’s management has assessed and concluded that there is no material impact on the amounts reported at transition to IFRS 15 on 1 January 2018. | 3A |
| Disclosure of issued IFRS not yet adopted [text block] | The following are the standards issued but not yet effective up to the date of issuance of the Company’s financial statements. The Company intends to adopt these standards when they become effective.IFRS 9 - Financial Instruments (including amendments to IFRS 4, Insurance Contracts)In July 2014, the IASB published IFRS 9 Financial Instruments which replaced IAS 39 Financial Instruments: Recognition and Measurement. The standard incorporates new classification and measurement requirements for financial assets, introduces an expected credit loss (ECL) impairment model which replaces the incurred loss model of IAS 39, and new hedge accounting requirements under IFRS 9: All financial assets will be measured at either amortised cost or fair value. The basis of classification will depend on the business model and the contractual cash flow characteristics of the financial assets. The standard retains most of IAS 39’s requirements for financial liabilities except for those designated at fair value through statement of income whereby that part of the fair value changes attributable to own credit is to be recognised in other comprehensive income instead of the statement of income; IFRS 9 requires entities to record an allowance for ECLs for all loans and other debt financial assets not held at fair value through statement of income as well as finance lease receivables, together with loan commitments and financial guarantee contracts. The allowance is based on the ECLs associated with the probability of default in the next twelve months unless there has been a significant increase in credit risk since origination. Under IFRS 9, credit losses are recognised earlier than under IAS 39; The hedge accounting requirements are more closely aligned with risk management practices and follow a more principle-based approach.In September 2016, the IASB published amendments to IFRS 4 Insurance Contracts that address the accounting consequences of the application of IFRS 9 to insurers prior to the publication of the forthcoming accounting standard for insurance contracts. The amendments introduce two options for insurers: the deferral approach and the overlay approach. The deferral approach provides an entity, if eligible, with a temporary exemption from applying IFRS 9 until the earlier of the effective date of a new insurance contract standard or 2022. The overlay approach allows an entity to remove from profit or loss the effects of some of the accounting mismatches that may occur before the new insurance contracts standard is applied.Under the temporary exemption as introduced by amendments to IFRS 4, the reporting entities whose activities predominantly relate to “insurance” can defer the implementation of IFRS 9. The Company has assessed the implications and has concluded to defer the implementation of IFRS 9 until a later date which will not be later than 1 January 2022.The impact of IFRS 9 adoption the Company’s financial statements will, to a large extent, have to take into account the interaction with the forthcoming insurance contracts standard. As such, it is not possible to fully assess the effect of the adoption of the IFRS 9 adoption.IFRS 17 - “Insurance Contracts”, applicable for the period beginning on or after 1 January 2022, and will supersede IFRS 4 “Insurance Contracts”. Earlier adoption permitted if both IFRS 15 'Revenue from Contracts with Customers' and IFRS 9 'Financial Instruments' have also been applied. The Company is now assessing the impact on measurement and disclosure of insurance and reinsurance that will affect both the statement of income and the statement of financial position. The Company has decided not to early adopt this new standard.IFRS 16 - “Leases”, applicable for the period beginning on or after 1 January 2019. The new standard eliminates the current dual accounting model for lessees under IAS 17, which distinguishes between on-balance sheet finance leases and off-balance sheet operating leases. Instead, IFRS 16 proposes on-balance sheet accounting model. The Company has decided not to early adopt this new standard.The Company is currently in the phase of assessing the impact of the above standards. | 3B |
| Disclosure of critical accounting judgements, estimates and assumptions, general [text block] | The preparation of the Company’s financial statements requires management to make judgments, estimates and assumptions that affect the reported amount of revenue, expenses, assets and liabilities, and the accompanying disclosures. Uncertainty about these assumptions and estimates could result in outcomes that require a material adjustment to the carrying amount of assets or liabilities affected in future years. 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. The following are the accounting judgments and estimates that are critical in the preparation of these financial statements:i) The ultimate liability arising from claims made under insurance contractsJudgment by management is required in the estimation of amounts due to medical providers and third parties arising from claims made under insurance contracts. Such estimates are necessarily based on assumptions about several factors involving varying degrees of judgment and uncertainty and actual results may differ from management’s estimates resulting in future changes in estimated liabilities. The Company estimates its claims based on its previous experience of its insurance portfolio. The provision for claims incurred but not reported (IBNR) is an estimation of claims which are expected to be reported subsequent to the date of statement of financial position, for which the insured event has occurred prior to the date of 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. Claims requiring court or arbitration decisions, if any, are estimated individually. Management reviews its provisions for claims incurred, and claims incurred but not reported, on a monthly basis. Any difference between the provisions at the statement of financial position date and settlements and provisions in the following year is included in the statement of income for that year. The provision for outstanding claims, as at 31 December, is also verified by an independent actuary.A range of methods such as the Chain Ladder Method, the Bornhuetter-Ferguson Method and the Expected Loss Ratio Method are used by the actuaries to determine these provisions. Also the Actuaries have used a segmentation approach which includes analyzing the costs per member per year for the medical line of business. Underlying these methods are also a number of explicit or implicit assumptions relating to the expected settlement amount and the settlement patterns of the claims.Estimation of premium deficiency for medical insurance 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 company’s actuarial team, and also the independent actuary, consider the claims and premiums relationship which is expected to apply on month to month basis, and ascertain, at the end of the financial period, whether a premium deficiency reserve is required.ii) Impairment of receivablesA provision for impairment of receivables and reinsurance 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.iii) Deferred acquisition costsCertain acquisition costs related to the sale of new policies are recorded as deferred acquisition costs and are amortised in the statement of income over the period of policy coverage. If the assumptions relating to future profitability of these policies are not realised, the amortisation of these costs could be accelerated and this may also require additional impairment write-offs in the statement of income.iv) Useful lives of fixtures, furniture and equipmentThe Company's management determines the estimated useful lives of its fixtures, furniture and equipment for calculating depreciation. These estimates are determined after considering the expected usage of the assets or physical wear and tear. Management reviews residual values and useful lives annually and future depreciation charges are adjusted where management believes the useful lives differ from previous estimates.v) Fair value of financial instrumentsThe fair value for financial instruments traded in active markets at the reporting date is based on their quoted market price. Where the fair values of financial assets and financial liabilities recorded on the statement of financial position cannot be derived from active markets, they are determined using a variety of valuation techniques that include the use of mathematical models. The inputs to these models are derived from observable market data where possible, but if this is not available, judgment is required to establish fair values.vi) Impairment of available-for-sale investmentsThe Company exercises judgment to consider impairment on the available for sale investments at each reporting date. This includes determination of a significant or prolonged decline in the fair value of equity securities below cost. The determination of what is 'significant' or 'prolonged' requires judgment. In making this judgment, the Company evaluates among other factors, the normal volatility in share prices. In addition, the Company considers impairment to be appropriate when there is evidence of deterioration in the financial health of the investee, industry and sector performance, changes in technology, and operational & financing cash flows.The Company considers 30% or more, as a reasonable measure for significant decline below its cost, irrespective of the duration of the decline, which is recognized in the statement of income as impairment charge on investments. Prolonged decline represents a decline below cost that persists for 1 year or longer irrespective of the amount and is recognised in the statement of income accordingly as an impairment charge on investments. The previously recognized impairment loss in respect of equity investments cannot be reversed through the statement of income. The Company reviews its debt securities classified as available for sale at each reporting date to assess whether they are impaired.vii) Going concernThe Company’s management has made an assessment of its ability to continue as a going concern and is satisfied that it has the resources to continue in business for the foreseeable future. Furthermore, management is not aware of any material uncertainties that may cast significant doubt upon the Company’s ability to continue as a going concern. Therefore, the financial statements continue to be prepared on the going concern basis.viii) Impairment of GoodwillGoodwill is initially measured at cost being the excess of the net fair value of the identifiable assets and liabilities acquired. Following initial recognition, goodwill is measured at cost less any accumulated impairment losses. Goodwill is reviewed for impairment, annually or more frequently if events or changes in circumstances indicate that the carrying value may be impaired. Impairment for goodwill is determined by assessing the recoverable amount of the cash generating unit (or a group of cash generating units) to which the goodwill is related. When the recoverable amount of the cash-generating unit (or a group of cash generating units) is less than the carrying amount of the cash generating unit (or a group of cash generating units) to which goodwill has been allocated, an impairment loss is recognised. Impairment losses relating to goodwill cannot be reversed in future periods. The recoverable amount is the greater of its value in use or fair value less cost to sell. In assessing the value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risk specific to the asset. | 2D |
| Disclosure of functional and presentation currency [text block] | These financial statements are presented in Saudi Arabian Riyals (SR), which is the Company’s functional currency. All financial information presented in SR has been rounded off to the nearest thousand except where otherwise indicated. | 2B |
| Disclosure of other general disclosures about reporting entity [text block] | The Company follows a fiscal year ending on 31 December. | 2C |
| Disclosure of summary of significant accounting policies [abstract] | | |
| Disclosure of summary of significant accounting policies, general comment [text block] | The significant accounting policies applied in the preparation of these financial statements are summarised below. These policies have been consistently applied to each of the years presented except for adoption of the amendments to existing standards and IFRS 15 | 3 |
| Description of accounting policy for cash and cash equivalents [text block] | Cash and cash equivalents consist of bank balances and term deposits that have original maturity periods not exceeding three months from the date of acquisition. | 3II |
| Description of accounting policy for premiums/ contributions and insurance/ reinsurance or takaful/ retakaful balance receivables [text block] | Premiums receivable are stated at gross written premiums receivable from insurance contracts, less an allowance for any uncollectible amounts. An allowance for uncollectible amount is established when there is objective evidence that the Company will not be able to collect all amounts due according to their original terms. Bad debts are written off as incurred. Subsequent recoveries of amounts previously written off are credited in the statement of income. | 3III |
| Description of accounting policy for deferred policy acquisition costs [text block] | Commission to sales staff and incremental direct costs incurred in relation to the acquisition and renewal of insurance contracts are deferred. The deferred acquisition costs are subsequently amortised over the terms of the insurance contract as premiums are earned and reported in the statement of income. Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodied in the asset are accounted for by changing the amortization period and are treated as a change in accounting estimate. If the assumptions relating to future profitability of these policies are not realised, the amortization of these costs could be accelerated and this may also require additional impairment write-offs in the statement of income. Deferred policy acquisition costs are also considered in the liability adequacy test for each reporting year. | 3IV |
| Description of accounting policy for intangible assets and goodwill [text block] | Intangible assets:Separately acquired intangible assets (softwares) are shown at historical cost. They have a finite useful life and are subsequently carried at cost less accumulated amortization and impairment losses. The Company amortises intangible assets with a limited useful life using straight-line method over the following periods:YearsIT development and software3 to 7Goodwill:Goodwill is initially measured at excess of the fair value of the consideration paid over the fair value of the identifiable assets and liabilities acquired. Following initial recognition, goodwill is measured at cost less any accumulated impairment losses. Goodwill is reviewed for impairment, annually or more frequently if events or changes in circumstances indicate that the carrying value may be impaired. Impairment for goodwill is determined by assessing the recoverable amount of the cash generating unit (or a group of cash generating units) to which the goodwill is related. When the recoverable amount of the cash-generating unit (or a group of cash generating units) is less than the carrying amount of the cash generating unit (or a group of cash generating units) to which goodwill has been allocated, an impairment loss is recognised in the statement of income. Impairment losses relating to goodwill cannot be reversed in future periods. | 3.VII & VIII |
| Description of accounting policy for property and equipment [text block] | Furniture, fixtures and equipment are initially recorded in the statement of financial position at cost less accumulated depreciation and any impairment in value. Depreciation is calculated on a straight line basis over the estimated useful lives of the assets. The estimated useful lives of the assets for the calculation of depreciation are as follows:YearsLeasehold Improvements (civil, construction work and fixtures) 15 years or lease termFurniture, fixtures and office equipment 5 to 20Computer 2.5 to 7Motor vehicles 4Residual values, useful lives and the methods of depreciation are reviewed and adjusted as appropriate at each financial year end. Impairment reviews take place when events or changes in circumstances indicate that the carrying value may not be recoverable. The depreciation charge for the year is recognised in the statement of income on an actual basis. Similarly, impairment losses, if any, are recognised in the statement of income.Expenditure for repairs and maintenance is charged to the statement of income. Subsequent expenditure is capitalised only if it is probable that the future economic benefits associated with the expenditure will flow to the Company. Gain / loss on sale of fixtures, furniture and equipment is included in statement of income. | 3VI |
| Description of accounting policy for liability adequacy test [text block] | At each reporting date the Company assesses annually whether its recognised insurance liabilities are adequate using current estimates of future cash flows under its insurance contracts. If that assessment shows that the carrying amount of its insurance liabilities is inadequate in the light of estimated future cash flows, the entire deficiency is immediately recognised in the statement of income and an unexpired risk provision is created. | 3IX |
| Description of accounting policy for accounts payable and accruals [text block] | Liabilities are recognised for amounts to be paid in the future for goods or services received, whether billed by the supplier or not. | 3X |
| Description of accounting policy for provisions [text block] | Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources will be required to settle the obligation and a reliable estimate can be made of the obligation amount. | 3XI |
| Description of accounting policy for statutory reserve [text block] | In accordance with the Company’s by-laws, the Company shall allocate 20% of its net income from shareholders operations each year to the statutory reserve until it has built up a reserve equal to the share capital. The reserve is not available for distribution. | 3XXX |
| Description of accounting policy for employees end of service benefits [text block] | Accruals are made at the present value of expected future payments in respect of services provided by the employees up to the end of the reporting period using the projected unit credit method. Consideration is given to the expected future wages and salary levels, experience of employee departures and periods of service. Expected future payments are discounted using market yields at the end of the reporting period of high-quality corporate bonds with terms and currencies that match, as closely as possible, the estimated future cash outflows. The benefit payments obligation is discharged as it falls due. Re-measurement (actuarial gains/ losses) as a result of experience adjustments and changes in actuarial assumptions are recognized in the statement of comprehensive income. | 3XII |
| Description of accounting policy for zakat [text block] | Under Saudi Arabian Zakat and Income Tax laws, zakat and income tax are the liabilities of the Saudi and foreign shareholders, respectively. Zakat is computed on the Saudi shareholders’ share of equity and / or net income using the basis defined under the zakat regulations. Income tax is computed on the foreign shareholders’ share of net income for the year. The Company withholds taxes on certain transactions with non-resident parties in the Kingdom of Saudi Arabia as required under Saudi Arabian Income Tax Law.Zakat and income tax are charged to retained earnings as these are liabilities of the shareholders. Income tax charged to retained earnings, in excess to the proportion of the Saudi Shareholders’ zakat per share, is recovered from the foreign shareholders and credited to retained earnings.No adjustments are made in the financial statements to account for the effect of deferred income taxes since zakat and income tax are the liabilities of the shareholders in the Kingdom of Saudi Arabia. | 3XXIX |
| Description of accounting policy for impairment and uncollectibiity of financial assets [text block] | The Company assesses at each reporting date, whether there is any objective evidence that a financial asset or a group of financial assets is impaired. A financial asset or a group of financial assets is deemed to be impaired if, and only if, there is an objective evidence of impairment as a result of one or more events that have occurred after the initial recognition of the asset (an incurred loss event) and that loss event (or events) has an impact on the estimated future cash flows of the financial asset or the group of financial assets that can be reliably estimated. If such evidence exists, an impairment loss is recognised in the statement of income. Evidence of impairment may include indications that the debtors or a group of debtors is experiencing a significant financial difficulty, default or delinquency in repayments, the probability that they will enter bankruptcy or other financial reorganisation and observable data indicating that there is a measurable decrease in the estimated future cash flows, such as changes in arrears or economic conditions that correlate with defaults. Impairment is determined as follows:(a) For assets carried at cost, impairment is the difference between carrying value and the present value of future cash flows discounted at the current market rate of return for a similar financial asset; and(b) For assets carried at amortised cost, impairment is the difference between the carrying amount and the present value of future cash flows discounted at the original effective commission rate. | 3XV |
| Description of accounting policy for cash dividend and non-cash distribution to equity holders [text block] | The Company recognises a liability to make cash distributions to shareholders of the Company when the distribution is authorised and is no longer at the discretion of the Company. A distribution is authorised when it is approved by the shareholders and SAMA. A corresponding amount is recognised directly in equity. | 3XXVIII |
| Description of accounting policy for reinsurance premium/ retakaful contributions [text block] | Reinsurance premiums ceded are recognised as an expense when payable. Reinsurance premiums are charged to income over the terms of the policies to which they relate on a pro-rata basis. | 3XIX |
| Description of accounting policy for reinsurance/ retakaful activities [text block] | Reinsurance contracts held:In order to minimise financial exposure from large claims, the Company enters into reinsurance agreements with internationally reputable reinsurers. Claims receivable from reinsurers are estimated in a manner consistent with the claim liability and in accordance with the reinsurance contracts. These amounts, if any, are shown as “Reinsurers’ share of outstanding claims” in the statement of financial position until the claim is agreed and paid by the Company. Once the claim is paid, the amount due from the reinsurers in connection with the paid claim is transferred to amounts due from / (to) reinsurers.At each reporting date, the Company assesses whether there is any indication that a reinsurance asset may be impaired. Where an indicator of impairment exists, the Company makes a formal estimate of recoverable amount. Where the carrying amount of a reinsurance asset exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount. | 3XXII |
| Description of accounting policy for investment income [text block] | (a) Financial assets at fair value through statement of incomeInvestments are classified as at fair value through statement of income if they are classified as held-for-trading or are designated as such on initial recognition. Directly attributable transaction costs are recognised in the statement of income as incurred. Subsequently, such investments are re-measured at fair value, with all changes in fair value being recorded in the statement of income.(b) Available for sale investmentsAvailable for sale investments are non-derivative investments that are designated as available for sale or not classified as another category of financial assets, and are intended to be held for an unspecified period of time, which may be sold in response to needs for liquidity or changes in special commission rates, exchange rates or equity prices.Investments which are classified as available for sale are initially recognised at fair value including direct and incremental transaction costs and subsequently measured at fair value except for unquoted equity securities where fair value cannot be reliably measured are carried at cost. Any unrealised gains or losses arising from changes in fair value are recognized through the statement of comprehensive income until the investments are derecognized or impaired whereupon any cumulative gains or losses previously recognized in equity are reclassified to statement of income for the period and are disclosed as gains/(losses) on non-trading investments. | 3V |
| Description of accounting policy for claims/ benefits [text block] | Claims, comprising amounts payable to medical providers and other third parties are charged to income as incurred. Claims comprise the estimated amounts payable, in respect of claims reported to the Company and those not reported at each reporting date.The Company estimates its claims based on previous experience. In addition, a provision based on the management’s judgment and the Company’s prior experience is maintained for the cost of settling claims incurred but not reported at each reporting date. Any difference between the provisions at the statement of financial position date & settlements and provisions for the following year is included in the underwriting account for that year.The Company does not discount its liability for unpaid claims as substantially all claims are expected to be paid within one year of the statement of financial position date. | 3XX |
| Description of accounting policy for life insurance/ takaful contracts [text block] | Insurance contracts are those contracts where the Company (the insurer) has accepted significant insurance risk from another party (the policyholders) by agreeing to compensate the policyholders if a specified uncertain future event (the insured event) adversely affects the policyholders. As a general guideline, the Company determines whether it has significant insurance risk by comparing benefits paid with benefits payable if the insured event did not occur.Once a contract has been classified as an insurance contract, it remains an insurance contract for the remainder of its lifetime, even if the insurance risk reduces significantly during this period, unless all rights and obligations are extinguished or expired. | 3XXI |
| Description of accounting policy for impairment of non-financial assets [text block] | The Company assesses at each reporting date whether there is an indication that an asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, the Company estimates the asset’s recoverable amount. An asset’s recoverable amount is the higher of an asset’s or cash-generating unit’s (CGU) fair value less costs to sell and its value in use and is determined for an individual asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. When the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair value less costs to sell, recent market transactions are taken into account, if available. If no such transactions can be identified, an appropriate valuation model is used. These calculations are corroborated by valuation multiples, quoted share prices or other available fair value indicators.The Company bases its impairment calculation on detailed budgets and forecast calculations, which are prepared separately for each of the Company’s CGUs to which the individual assets are allocated. These budgets and forecast calculations generally cover a period of three to five years. For longer periods, a long-term growth rate is calculated and applied to project future cash flows after the fifth year.Impairment losses of continuing operations are recognised in the statement of income.For assets, excluding goodwill, an assessment is made at each reporting date whether there is any indication that previously recognised impairment losses may no longer exist or may have decreased. If such indication exists, the Company estimates the asset’s recoverable amount. A previously recognised impairment loss is reversed only if there has been a change in the assumptions used to determine the asset’s recoverable amount since the last impairment loss was recognised. The reversal is limited so that the carrying amount of the asset does not exceed its recoverable amount nor exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognised for the asset in prior years. Such reversal is recognised in the statement of income. | 3XVI |
| Description of accounting policy for other revenue recognition [text block] | Premiums earnedThe Company only issues short-term insurance contracts for providing health care services (‘medical insurance’) in Saudi Arabia. Premiums are taken to income over the terms of the policies to which they relate on a pro-rata basis based on 365th method. Unearned premiums represent the portion of premiums written relating to the unexpired period of coverage. The change in the provision for unearned premiums is taken to the statement of income.Investment and commission incomeInvestment income or loss comprises of unrealised and realised gains and losses on investments. Commission income on term deposits is recognised using the effective interest method in the statement of income. | 3XVIII |
| Description of accounting policy for expenses [text block] | Selling and marketing expenses are those which specifically relate to salesmen, sales promotion, advertisements, regulatory levies, trade mark fees and fulfillment costs. All other expenses are classified as general and administration expenses. | 3XXIII |
| Description of accounting policy for share based payments [text block] | The cost of equity-settled transactions with employees is measured by reference to the fair value at the date on which they are granted. Grant date is date at which the entity and an employee agree to a share-based payment arrangement, being when the entity and the counterparty have a shared understanding of the terms and conditions of the arrangement. The cost of equity-settled transactions is recognised, together with a corresponding increase in equity as a reserve for a share based payment, over the period in which the performance and/or service conditions are fulfilled, ending on the date on which the relevant employees become fully entitled to the award (‘the vesting date’). The cumulative expense recognised for equity-settled transactions at each reporting date until the vesting date reflects the extent to which the vesting period has expired and the Company's best estimate of the number of equity instruments that will ultimately vest. The statement of income charge or credit for a period represents the movement in cumulative expense recognised as at the beginning and end of that period.In cases where an award is forfeited (i.e. when the vesting conditions relating to an award are not satisfied), the Company reverses the expense relating to such awards previously recognized in the statement of income.Where an equity-settled award is cancelled (other than forfeiture), it is treated as if it vested on the date of cancellation, and any expense not yet recognised for the award is recognised immediately.Shares held under employee share scheme:The Company purchases shares held under employee share scheme to hedge itself against adverse changes in fair value of its shares between the grant date and the date on which these shares are transferred to employees. When shares recognised as equity are repurchased, the amount of the consideration paid, which includes directly attributable costs, is recognised as a deduction from equity. Repurchased shares are classified as shares held under employee share scheme and are presented in the statement of changes in equity. | 3.XIII & XIV |
| Description of accounting policy for segment reporting [text block] | An operating segment is a component of an entity:- that engages in business activities from which it may earn revenues and incur expenses (including revenues and expenses relating to transactions with other components of the same entity); and- whose operating results are regularly reviewed by the entity’s chief operating decision maker to make decisions about resources to be allocated to the segment and assess its performance; and- for which discrete financial information is available. | 3XXIV |
| Description of accounting policy for accounting of leases [text block] | Leases where the lessor retains substantially all the risks and benefits of ownership of the asset are classified as operating leases. Operating lease payments are recognised as an expense in the statement of income on a straight-line basis over the lease term. | 3XXV |
| Description of accounting policy for foreign currencies [text block] | The accounting records of the Company are maintained in Saudi Riyals. Transactions in foreign currencies are recorded in Saudi Riyals at the approximate rate of exchange ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated at the spot rate at the reporting date. All differences are taken to the statement of income. | 3XXVI |
| Description of accounting policy for derivative financial instruments and hedges [text block] | Financial instruments comprise financial assets and financial liabilities.Financial assets consist of cash and cash equivalents, premiums receivable, reinsurance share of outstanding claims, reinsurance share of incurred but not reported claims, investments, term deposits, statutory deposit and other receivables. Financial liabilities consist of insurance operations surplus payable, reinsurance balances payable, outstanding claims, claims incurred but not reported, claims handling reserve, amounts due to related parties, provision for end-of-service benefits, zakat and income tax and certain other liabilities.Date of recognitionRegular way sale and purchase of financial instruments is recognised on the trade date, i.e., the date that the Company becomes a party to the contractual provisions of the instrument. Regular way purchases or sales are purchases or sales of financial instruments that require settlement of instrument within the time frame generally established by regulation or convention in the market place.Measurement of financial instrumentsAll financial instruments are measured initially at their fair value plus, in the case of financial assets and financial liabilities not at fair value through statement of income, any directly attributable incremental costs of acquisition or issue. The classification of financial instruments at initial recognition depends on the purpose for which the financial instruments were acquired and their characteristics. Subsequent to initial measurement, financial instruments are carried at amortised cost except for FVSI and AFS investments which are carried at fair value. | 3I |
| Description of accounting policy for financial assets [text block] | Financial assetA financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is derecognised when: the rights to receive cash flows from the asset have expired; or the Company has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a ‘pass-through’ arrangement; and either (a) the Company has transferred substantially all the risks and rewards of the asset, or (b) the Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.When the Company has transferred its rights to receive cash flows from an asset or has entered into a ‘pass-through’ arrangement, it evaluates if and to what extent it has retained the risks and rewards of ownership. When it has neither transferred nor retained substantially all of the risks and rewards of the asset, nor transferred control of the asset, the asset is recognised to the extent of the Company’s continuing involvement in the asset. In that case, the Company also recognises an associated liability. The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that the Company has retained. Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that the Company could be required to repay.Financial liabilityA financial liability is derecognised when the obligation under the liability is discharged , cancelled or expired. | 3.XVII |
| Description of accounting policy for off setting financial assets and liabilities [text block] | Financial assets and financial liabilities are offset and the net amount is reported in the statement of financial position only when there is a legally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis, or to realise the assets and settle the liabilities simultaneously. Income and expenses are not offset in the statement of income unless required or permitted by any accounting standard or interpretation, as specifically disclosed in the accounting policies of the Company. | 3XXVII |
| Description of accounting policy for time (murabaha) deposit [text block] | Term deposits, with original maturity of more than three months, are initially recognized in the statement of financial position at fair value and are subsequently measured at amortised cost using the effective interest method, less any impairment in value. | 3V |
| Disclosure of notes forming part of accounts [abstract] | | |
| Disclosure of property and equipment [text block] | Office, furniture,and fixturesComputerequipmentMotor vehiclesLeasehold improvementsCapital work in progressTotalSR’000Cost:At 1 January 201773,36236,357212--26,659136,590Additions during the year1,6481,274----28,63531,557Disposals during the year(573)--------(573)Transferred during the year1,34030----(1,370)--At 1 January 201875,77737,661212--53,924167,574Additions during the year1,1611,469--563,1345,820Disposal during the year(1,020)(2,182)(212)----(3,414)Transferred during the year9,4421,601--38,515(53,974)(4,416)At 31 December 201885,36038,549--38,5713,084165,564Accumulated depreciation:At 1 January 201737,66925,130212----63,011Charge for the year6,4774,601------11,078Disposals during the year(132)----(132)At 1 January 201844,01429,731212----73,957Charge for the year6,4745,309--1,716--13,499Disposal during the year(749)(2,174)(212)----(3,135)At 31 December 201849,73932,866--1,716--84,321Net book value:At 31 December 201835,6215,683--36,8553,08481,243At 31 December 201731,7637,930----53,92493,617 | 10 |
| Disclosure of investments [text block] | Investments are classified as follows:20182017Insurance operationsShareholders’ operationsTotalInsurance operationsShareholders’ operationsTotalSR’000Held as FVSI249,284131,110380,394411,441495,966907,407Available-for-sale560,891680,2061,241,097409,335404,948814,283810,175811,3161,621,491820,776900,9141,721,690(i) Investments held as FVSI comprise of the following:2018Insurance operationsShareholders’ operationsDomesticInternationalDomesticInternationalTotalSR’000Sukuks32,025--95,079--127,104Funds217,259--36,031--253,290249,284--131,110--380,3942017Insurance operationsShareholders’ operationsDomesticInternationalDomesticInternationalTotalSR’000Sukuks32,025--95,079--127,104Funds379,416--299,987--679,403Investments in discretionary portfolios----100,900--100,900411,441--495,966--907,407(ii) Available-for-sale investments comprise of the following:2018Insurance operationsShareholders’ operationsDomesticInternationalDomesticInternationalTotalSR’000Sukuks241,784281,828280,697186,924991,233Funds--37,279109,24710,536157,062Investments in discretionary portfolios----92,802--92,802241,784319,107482,746197,4601,241,0972017Insurance operationsShareholders’ operationsDomesticInternationalDomesticInternationalTotalSR’000Sukuks152,862218,972243,690145,037760,561Funds--37,501--16,22153,722152,862256,473243,690161,258814,283The movements in the investments balance are as follows:2018Insurance operationsShareholders’operationsTotalSAR‘000Balance at the beginning of the year820,776900,9141,721,690Purchases during the year1,033,480794,5441,828,024Disposals during the year(1,040,322)(865,503)(1,905,825)Unrealised losses during the year, net(3,759)(18,639)(22,398)810,175811,3161,621,4912017Insurance operationsShareholders’ operationsTotalSAR‘000Balance at the beginning of the year544,090714,3301,258,420Purchases during the year958,7241,462,8482,421,572Disposals during the year(687,758)(1,281,673)(1,969,431)Unrealised gains during the year, net5,7205,40911,129820,776900,9141,721,690 | 7 |
| Disclosure of investments held-to-maturity [text block] | Term deposits are held with reputable commercial banks and financial institutions. These deposits are predominately in Murabaha structures with a small allocation in Mudaraba structures. They are mostly denominated in Saudi Arabian Riyals, have an original maturity of more than three months, and yield financial income at rates ranging from 2.27% to 4.00% per annum (2017: 2.15% to 4.10% per annum). The movements in term deposits during the year ended 31 December 2018 and year ended 31 December 2017, respectively are as follows:2018Insurance operationsShareholders’operationsTotalSR‘000Balance at beginning of the year2,912,5771,032,8063,945,383Matured during the year(3,724,883)(829,977)(4,554,860)Placed during the year3,846,0491,478,7095,324,7583,033,7431,681,5384,715,2812017InsuranceoperationsShareholders’ operationsTotalSR‘000Balance at beginning of the year3,057,816987,4944,045,310Matured during the year(3,057,816)(987,494)(4,045,310)Placed during the year2,912,5771,032,8063,945,3832,912,5771,032,8063,945,383 | 9 |
| Disclosure of deferred policy acquisition costs [text block] | 20182017SR’000SR’000Balance at beginning of the year71,07672,281Paid and accrued during the year226,842150,436Amortisation for the year(179,595)(151,641)118,32371,076 | 14 |
| Disclosure of premiums/ contributions and insurance/ reinsurance or takaful/ retakaful balance receivables [text block] | Receivables comprise of amounts due from the following:20182017SR’000SR’000Policyholders755,292732,557Brokers364,610280,873Related parties (note 24)--2261,119,9021,013,656Provision for doubtful receivables(169,231)(142,674)Premiums receivable – net950,671870,982Movement in provision for doubtful debts during the year was as follows:20182017SR’000SR’000Balance at the beginning of the year142,674142,997Provision made during the year32,2563,718Utilised during the year(5,699)(4,041)Balance at end of the year169,231142,674The gross amount of impaired receivables amounted to SR 482,706 thousand (31 December 2017: SR 402,333 thousand). The aging analysis of premiums receivable - net arising from insurance contracts is as follows:Unimpaired receivables are estimated, on the basis of past experience, to be fully recoverable. It is not the practice of the Company to obtain collateral over receivables.The Company only enters into insurance and reinsurance contracts with recognised, creditworthy third parties. It is the Company’s policy that all customers who wish to trade on credit terms are subject to credit verification procedures. In addition, receivables are monitored on an ongoing basis in order to reduce the Company’s exposure to bad debts.The five largest customers account for 6.4% (31 December 2017: 10.4%) of the premiums receivable as at 31 December 2018. | 6 |
| Disclosure of prepayments and other assets [text block] | Prepaid expenses and other assets comprise of the following:20182017Insurance operationsShareholders’ operationsTotalInsurance operationsShareholders’ operationsTotalSR’000Prepayments51,251--51,25137,993--37,993Accrued income45,94934,11980,06860,46612,99373,459Restricted deposits26,346--26,34632,683--32,683Other receivables45,320--45,32026,393--26,393168,86634,119202,985157,53512,993170,528 | 8 |
| Disclosure of cash and cash equivalents [text block] | Cash and cash equivalents comprise of the following:2018Insurance operationsShareholders’operationsTotalSR‘000Bank balances272,52717,886290,4132017Insurance operationsShareholders’ operationsTotalSR‘000Bank balances110,384119,500229,884The amount payable to/receivable from shareholders’ operations is settled by transfer of cash at each reporting date. During the year ended 31 December 2018, the insurance operations transferred cash of SR 99 million to shareholders’ operations (31 December 2017: SR 420.5 million). | 5 |
| Disclosure of statutory deposit [text block] | As required by SAMA Insurance Regulations, the Company deposited an amount equivalent to 10% of its paid-up share capital, amounting to SR 120 million (2017: SR 80 million), in a bank designated by SAMA. Accrued income on this deposit is payable to SAMA amounting to SR 6.9 million (2017: SR 5.1 million) and this deposit cannot be withdrawn without approval from SAMA. | 12 |
| Disclosure of employees' end of service benefits [text block] | Accruals are made in accordance with the actuarial valuation under the projected unit credit method while the benefit payments obligation is discharged as and when it falls due. The amounts recognized in the statement of financial position and movement in the obligation during the year based on its present value are as follows:21.1 Movement of defined benefit obligation20182017SR’000SR’000Balance at the beginning of the year66,46959,316Charge to the statement of income during the year16,22615,150Charge to the statement of other comprehensive income during the year8,922--Benefits paid during the year(10,222)(7,997)Balance at the end of the year81,39566,46921.2 Reconciliation of present value of defined benefit obligation20182017SR’000SR’000Balance at the beginning of the year66,46959,316Current service costs13,10312,405Financial costs3,1232,745Actuarial loss8,922--Benefits paid during the year(10,222)(7,997)Balance at the end of the year81,39566,46921.3 Principal actuarial assumptionsThe following range of significant actuarial assumptions was used by the Company for the valuation of defined benefit obligation liability:2018Valuation discount rate4.60%Expected rate of increase in salary level across different age bands6.50%The impact of changes in sensitivities on present value of defined benefit obligation is as follows:2018SR’000Valuation discount rate- Increase by 5%(2,149)- Decrease by 5%2,263Expected rate of increase in salary level across different age bands- Increase by 1%195- Decrease by 1%(195)Mortality rate- Increase by 50%(8)- Decrease by 50%8Employee turnover- Increase by 20%(1,367)- Decrease by 20%1,498The average duration of the defined benefit plan obligation at the end of the reporting period is 7.21 years. | 21 |
| Disclosure of reinsurance/ retakaful balance payable [text block] | Reinsurance payable represents amounts payable to reinsurers of SR 50.6 million (2017: SR 39.6 million), for the excess of loss (XOL) reinsurance contract. | 25 |
| Disclosure of accrued expenses and other liabilities [text block] | Accrued and other liabilities comprise of the following:20182017Insurance operationsShareholders’ operationsTotalInsurance operationsShareholders’ operationsTotalSR’000Accrued expenses130,0754,784134,85979,3907,61487,004VAT payable69,911--69,911------Advances from policyholders48,567--48,56736,004--36,004Other liabilities32,472--32,47222,590--22,590281,0254,784285,809137,9847,614145,598 | 18 |
| Disclosure of zakat [text block] | a) ZakatThe Zakat payable by the Company has been calculated in accordance with Zakat regulations in Saudi Arabia.The Zakat provision for the year is based on the following:20182017SR’000SR’000Share capital486,000526,000Opening retained earnings, reserve and surplus835,259747,924Opening provisions127,054133,021Adjusted net income356,563232,016Fixtures, furniture, equipment and goodwill(141,588)(59,431)Investments(3,849,589)(3,781,987)Others(72,900)(117,035)Adjusted income attributable to Saudi shareholders and the general public (refer (*) below)(2,259,201)(2,319,492)*As disclosed in note 27, during the current year, the shareholding attributable to Saudi shareholders and the general public has changed from 65.75% to 60.75%. Adjusted income has been computed on a pro-rata basis taking into consideration before and after shareholding change.The differences between the financial and the “Zakatable” results are mainly due to certain adjustments in accordance with the relevant fiscal regulations.The Zakat charge relating to the Saudi shareholders consists of:20182017SR’000SR’000Provision for zakat @ 2.5%8,9148,822Adjustment for assessment of zakat35,61039,240Adjustment for previous years4,124--48,64848,062The movements in the Zakat provision during the year were as follows:20182017SR’000SR’000Balance at beginning of the year144,326108,942Charge for the year48,64848,062Payment made during the year(8,679)(12,678)184,295144,326b) Income Tax20182017SR’000SR’000Charge for the year40,55131,167The movement in the income tax provision during the year was as follows:20182017SR’000SR’000Balance at beginning of the year4,3788,011Charge for the year40,55131,167Payment made during the year(29,440)(34,800)15,4894,378c) Provision for zakat and income tax20182017SR’000SR’000Zakat payable (note (a) above)184,295144,326Income tax payable (note (b) above)15,4894,378199,784148,704d) Status of assessmentThe Company has filed its zakat and income tax returns for the financial years up to and including the year 2017 with the General Authority of Zakat and Tax (the “GAZT”).In prior years, the Company has received assessments for the fiscal periods 2008 through 2010 raising additional demands aggregating to SR 9 million, principally on account of disallowance of FVSI investments and statutory deposits from the zakat base. The Company has filed appeals against these assessments with the GAZT. Further, for the years 2011 and 2012, the Company has received Preliminary Objection Committee’s decisions in favour of the GAZT for the additional zakat liability of SR 17 million and has filed an appeal with the Higher Appeal Committee.The Company has recently received final assessments for the fiscal years 2013 through 2016 of additional zakat, corporate income tax and withholding tax as well as delay fine on the assessed additional corporate income tax and withholding tax. The differences have mainly arisen due to disallowance of investments and statutory deposits from the zakat base as well as not taking into consideration the tax and zakat already settled along with the tax / zakat declarations for the respective years. The Company has filed appeals against these assessments with the GAZT.The Company is also awaiting GAZT’s decision on additional submissions of 2014 relating to the treatment of the statutory deposit and the cooperative distribution for the fiscal periods 2008 through 2013. | 26A |
| Disclosure of income tax [text block] | a) ZakatThe Zakat payable by the Company has been calculated in accordance with Zakat regulations in Saudi Arabia.The Zakat provision for the year is based on the following:20182017SR’000SR’000Share capital486,000526,000Opening retained earnings, reserve and surplus835,259747,924Opening provisions127,054133,021Adjusted net income356,563232,016Fixtures, furniture, equipment and goodwill(141,588)(59,431)Investments(3,849,589)(3,781,987)Others(72,900)(117,035)Adjusted income attributable to Saudi shareholders and the general public (refer (*) below)(2,259,201)(2,319,492)*As disclosed in note 27, during the current year, the shareholding attributable to Saudi shareholders and the general public has changed from 65.75% to 60.75%. Adjusted income has been computed on a pro-rata basis taking into consideration before and after shareholding change.The differences between the financial and the “Zakatable” results are mainly due to certain adjustments in accordance with the relevant fiscal regulations.The Zakat charge relating to the Saudi shareholders consists of:20182017SR’000SR’000Provision for zakat @ 2.5%8,9148,822Adjustment for assessment of zakat35,61039,240Adjustment for previous years4,124--48,64848,062The movements in the Zakat provision during the year were as follows:20182017SR’000SR’000Balance at beginning of the year144,326108,942Charge for the year48,64848,062Payment made during the year(8,679)(12,678)184,295144,326b) Income Tax20182017SR’000SR’000Charge for the year40,55131,167The movement in the income tax provision during the year was as follows:20182017SR’000SR’000Balance at beginning of the year4,3788,011Charge for the year40,55131,167Payment made during the year(29,440)(34,800)15,4894,378c) Provision for zakat and income tax20182017SR’000SR’000Zakat payable (note (a) above)184,295144,326Income tax payable (note (b) above)15,4894,378199,784148,704d) Status of assessmentThe Company has filed its zakat and income tax returns for the financial years up to and including the year 2017 with the General Authority of Zakat and Tax (the “GAZT”).In prior years, the Company has received assessments for the fiscal periods 2008 through 2010 raising additional demands aggregating to SR 9 million, principally on account of disallowance of FVSI investments and statutory deposits from the zakat base. The Company has filed appeals against these assessments with the GAZT. Further, for the years 2011 and 2012, the Company has received Preliminary Objection Committee’s decisions in favour of the GAZT for the additional zakat liability of SR 17 million and has filed an appeal with the Higher Appeal Committee.The Company has recently received final assessments for the fiscal years 2013 through 2016 of additional zakat, corporate income tax and withholding tax as well as delay fine on the assessed additional corporate income tax and withholding tax. The differences have mainly arisen due to disallowance of investments and statutory deposits from the zakat base as well as not taking into consideration the tax and zakat already settled along with the tax / zakat declarations for the respective years. The Company has filed appeals against these assessments with the GAZT.The Company is also awaiting GAZT’s decision on additional submissions of 2014 relating to the treatment of the statutory deposit and the cooperative distribution for the fiscal periods 2008 through 2013. | 26B |
| Disclosure of classes of share capital [text block] | The authorised, issued and paid-up capital of the Company was SR 1,200 million at 31 December 2018 (31 December 2017: SR 800 million) consisting of 120 million shares (31 December 2017: 80 million shares) of SR 10 each.On 7 August 2018, after receiving the required approvals, Bupa Investments Overseas Limited purchased 5% shareholding in the Company from the Nazer Group, 0.09% from ASAS Health Care Company Limited, and 4.91% from Modern Computer Programs Company Limited. Bupa Investments Overseas Limited, as at 31 December 2018 owns 39.25% (2017: 34.25%) and Nazer Group owns 13.09% (2017: 18.09%).During the year, there has been 50% increase in the share capital of the Company by way of issuance of bonus shares. The increase in share capital was funded from the retained earnings account by transferring an amount of SR 400 million which resulted in an increase in authorized, issued and paid up share capital to SR 1,200 million from SR 800 million. The number of issued shares have increased from Eighty Million (80,000,000) to One Hundred Twenty Million (120,000,000) shares. The Company received all required approvals from the authorities and the shareholders approved this capital increase, as well as the related changes in the By-laws of the Company, in the Extraordinary General Assembly meeting held on 22 November 2018. The new bonus shares capital was issued by Tadawul on 25 November 2018 and the update of the Company’s By-Laws completed during January 2019. The final formalities relating to update the Commercial Registration of the Company will be completed during the first quarter of 2019.The shareholding structure of the Company as at 31 December 2018, was reflected as below:20182017Holding PercentageSR‘000Holding PercentageSR‘000Major shareholders52.3%628,06652.3%418,710General Public47.7%571,93447.7%381,290100.0%1,200,000100.0%800,000 | 27 |
| Disclosure of statutory reserve [text block] | As required by the Saudi Arabian Insurance Regulations, 20% of the shareholders’ income shall be set aside as a statutory reserve until this reserve amounts to 100% of the paid-up share capital. The Company makes this transfer on an annual basis at 31 December. As at 31 December 2018, SR 609.1 million (31 December 2017: SR 504.02 million) had been set aside as a statutory reserve, representing 51% (31 December 2017: 63%) of the paid-up share capital. | 28 |
| Disclosure of general and administrative expense [text block] | 20182017Insurance operationsShareholders’ operationsTotalInsurance operationsShareholders’ operationsTotalSR’000Employees’ costs328,907--328,907267,899--267,899Rents and maintenance costs32,590--32,59031,374--31,374Travelling expenses8,092--8,0928,937--8,937Depreciation and amortization21,571--21,57116,827--16,827Communication expenses6,858--6,8588,934--8,934Board expenses--3,9903,990--3,5443,544Others25,3096,36931,67835,1037,50942,612423,32710,359433,686369,07411,053380,127 | 31 |
| Disclosure of selling and marketing expenses [text block] | 20182017SR’000SR’000Employees’ costs108,733117,274Marketing expenses33,45026,530Fulfilment costs11,23510,472Statutory levies119,066110,565Trade mark fee (see note 19)20,54219,321Others28,97824,064322,004308,226 | 32 |
| Disclosure of investments income [text block] | 20182017Insurance operationsShareholders’ operationsTotalInsurance operationsShareholders’ operationsTotalSR’000Commission income92,31574,667166,98291,10243,027134,129Realised gains on investment, net2,5167,68610,2023,5598,25711,816Unrealised gains on FVSI investments, net5,5431,4236,9665,0077,28912,296100,37483,776184,15099,66858,573158,241 | 33 |
| Disclosure of technical reserve for insurance/takaful/reinsurance/retakaful operations [text block] | 13.1 Net outstanding claims and reserves20182017SR’000SR’000Claims outstanding reserves555,158450,249Claims incurred but not reported898,123871,998Claims handling reserve19,40019,2891,472,6811,341,536Less:Reinsurers’ share of outstanding claims(336)(360)Reinsurers’ share of claims incurred but not reported(2,678)(670)(3,014)(1,030)Net outstanding claims reserve1,469,6671,340,50613.2 Movement in unearned premiumsMovements in unearned premiums are as follows:2018GrossReinsuranceNetSR’000Balance at beginning of the year3,091,079(5,146)3,085,933Premium written/(ceded) during the year8,566,648(80,528)8,486,120Premium earned during the year(8,229,596)79,354(8,150,242)3,428,131(6,320)3,421,8112017GrossReinsuranceNetSR’000Balance at beginning of the year3,094,990(1,356)3,093,634Premium written/(ceded) during the year7,732,961(68,348)7,664,613Premium earned during the year(7,736,872)64,558(7,672,314)3,091,079(5,146)3,085,933 | 13 |
| Disclosure of earnings per share [text block] | The basic earnings per share has been calculated by dividing net income for the year by the weighted average number of ordinary shares issued and outstanding at year end. Diluted earnings per share is not applicable to the Company.The earnings per share for the previous year, of SR 4.18 per share, has been calculated based on the weighted average number of shares in issue after the 2018 capital increase, to 120,000,000 (one hundred and twenty million) shares, as was approved during the Extraordinary General Assembly meeting of the shareholders during the year, and the prior year earnings per share adjustment has been made in accordance with the relevant International Accounting Standards. | 35 |
| Disclosure of related party transactions [text block] | Related parties represent major shareholders, Board members 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. Contract pricing policies and terms are conducted on an arm’s length basis and transactions approved by the Company’s management, or where required and applicable the Company’s Board of Directors. The following are the details of the major related party transactions during the year and their related balances:Related partyNature of transactionAmount of transactionsReceivable/(payable)balance as at2018201720182017SR’000SR’000SR’000SR’000ShareholdersInsurance premium written70,34329,884(498)**226**ShareholdersReinsurance Premium ceded14,9399,252(23,242)*(11,476)*ShareholdersClaims paid38,91013,994(2,784)***(1,113)***ShareholdersMedical costs charged by providers38,8171,237(110)***(138)***ShareholdersExpenses charged to/from a related party _ net1,927284(41)*(820)*ShareholdersTax equalisation – net9,120--2,988*(1,169)*ShareholdersBoard and committee member remuneration fees858800(258)*(800)*Bupa Middle East Holdings Two W.L.L. (Related party)Trade mark fee20,54219,321(20,542)*(19,321)*Board member (related party)Shariah review services--119----* Amounts due to related parties amounted to SR 41,095 thousand (2017: SR 33,586 thousand).** Amounts included in premium receivables.*** Amounts are included in the outstanding claims.a. Compensation to key management personnel:20182017SAR’000SAR’000Salaries and allowances (note (a) below)17,72816,888Incentives (note (b) below)14,04014,178End of Service97887932,74631,945a) Includes the members’ direct salary related expenses, other than the incentives’ and EOS expenses.b) Includes the costs of the bonuses and the long term incentive plan.b. Board of Directors’ remuneration and related expenses20182017SAR’000SAR’000Board of Directors’ remuneration (note (a) below)2,8562,900Board attendance fees (note (b) below)-(96)Other board and sub-committees’ expenses (note (c) below)8237403,6793,544a) Board of Directors’ remuneration is paid in accordance with the By-Laws of the Company, and the Board Member Remuneration Policy as approved by the public shareholders.b) Per the shareholder approved Board and Board Committee Member Remuneration policies no Board or Board Committee attendance fee allowances are paid/payable by the Company so in 2018 attendance fees are nil and the 2016 attendance fees accrued were not paid but were reversed during 2017.c) Other board and sub-committee expenses includes the fees of the non-Board members for attending the Board Committee meetings, in accordance with the Board Committee Member Remuneration Policy, as approved by the public shareholders, and also include other related Board/Board Committee meeting expenses incurred. | 24 |
| Disclosure of entity's operating segments [text block] | The Company only issues short-term insurance contracts for providing health care services (‘medical insurance’). All the insurance operations of the Company are carried out in the Kingdom of Saudi Arabia. For management reporting purposes, the operations are monitored in two customer categories, based on the number of members covered. Major customers represent members of large corporations, and all others are considered as non-major. Operating segments are reported in a manner consistent with internal reporting provided to the chief operating decision maker, who is responsible for allocating resources and assessing the performance of operating segments in line with the strategic decisions.Operating segments do not include shareholders’ operations of the Company.Segment results do not include investment and commission income, other income, selling and marketing expenses, and general and administration expenses.Segment assets do not include cash and cash equivalents, term deposits, investments, and prepayments & other assets. Segment liabilities do not include reinsurance balance payable, accrued expenses and other liabilities, due to shareholders’ operations, share-based payment and policyholders’ share of surplus from insurance operations.Consistent with the Company’s internal reporting, operating segments have been approved by the management in respect of the Company’s activities, assets and liabilities as stated below:As at 31 December 2018Insurance operationsOperating segmentsMajor customersNon-major customersTotal - Insurance operationsShareholders’ operationsTotalSR’000SR’000SR’000AssetsPremiums receivable - net558,492392,179950,671--950,671Reinsurers’ share of unearned premiums2,4653,8556,320--6,320Reinsurers’ share of outstanding claims30630336--336Reinsurers’ share of claims incurred but not reported2,4372412,678--2,678Deferred policy acquisition costs72,17746,146118,323--118,323Unallocated assets4,285,3112,908,2577,193,568Total assets5,363,6392,908,2578,271,896LiabilitiesUnearned premiums2,091,1601,336,9713,428,131--3,428,131Outstanding claims355,301199,857555,158--555,158Claims incurred but not reported574,799323,324898,123--898,123Claims handling reserve12,4166,98419,400--19,400Unallocated liabilities471,416333,940805,356Total liabilities5,372,228333,9405,706,1682018Operating segmentsMajor customersNon-major customersTotalSR’000REVENUESGross premiums written5,454,9333,111,7158,566,648Reinsurance premiums ceded – Local(5,991)(3,847)(9,838)Reinsurance premiums ceded – International(43,051)(27,639)(70,690)Net premiums written5,405,8913,080,2298,486,120Changes in unearned premiums(201,029)(136,023)(337,052)Changes in reinsurance share of unearned premiums2,465(1,291)1,174Net premiums earned5,207,3272,942,9158,150,242UNDERWRITING COSTS AND EXPENSESGross claims paid(4,337,336)(2,371,188)(6,708,524)Reinsurers’ share of claims paid30,19418,50648,700Net claims paid(4,307,142)(2,352,682)(6,659,824)Changes in outstanding claims(59,118)(45,791)(104,909)Changes in claims incurred but not reported(24,744)(1,381)(26,125)Changes in claims handling reserves(71)(40)(111)Reinsurance share of changes in outstanding claims(21)(3)(24)Reinsurance share of changes in claims incurred but not reported1,8281802,008Net claims incurred(4,389,268)(2,399,717)(6,788,985)Policy acquisition costs(131,711)(65,660)(197,371)TOTAL UNDERWRITING COSTS AND EXPENSES(4,520,979)(2,465,377)(6,986,356)NET UNDERWRITING RESULTS686,348477,5381,163,886OTHER OPERATING (EXPENSES)/ INCOMEAllowance for doubtful receivables(32,256)Unallocated income198,218Unallocated expenses(755,690)TOTAL OTHER OPERATING (EXPENSES)/INCOME(589,728)NET INCOME FOR THE YEAR574,158Net income attributed to insurance operations(48,727)Net income attributed to the shareholders525,431 | 23 |
| Disclosure of capital management [text block] | For the purpose of the Company’s capital management, capital includes share capital and all other equity reserves attributable to the shareholders. Objectives are set by the Board of Directors of the Company to maintain healthy capital ratios to support its business objectives and maximise 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 the risk characteristics of the Company’s activities. To maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to shareholders or issue shares. Total capital amounted to SR 2,598,322 thousand (31 December 2017: SR 2,333,032).In the opinion of the Board of Directors, the Company has fully complied with the regulatory capital requirements during the reported financial year. No changes were made in the objectives, policies or processes for managing capital during the years ended 31 December 2018 and 2017. | 30 |
| Disclosure of insurance/ takaful operations surplus and dividends [text block] | INSURANCE OPERATIONS’ SURPLUS PAYABLE:20182017SR’000SR’000Balance at beginning of the year138,581169,884Income attributable to insurance operations during the year48,72750,392Surplus paid to policyholders during the year(47,553)(81,695)Net surplus payable to policyholders139,755138,581DIVIDENDS:On 17 April 2018, the Company’s Board of Directors proposed to pay a dividend, for the year ended 31 December 2017, of SR 2 per share totaling SR 160 million to its shareholders (2016: SR120 million). This dividend proposal was presented and approved by the shareholders in the Extraordinary General Assembly meeting, held on 31 May 2018, and accordingly, the dividend payment was completed on 11 June 2018. | 20 & 34 |
| Disclosure of equity incentive plan [text block] | The Company offers a Long-Term Incentive Plan (LTIP) to certain eligible employees and the purpose of the scheme is to incentivise the senior management team to achieve the Company’s long-term goals and to attract and retain top performers. The plan provides focus on both current and future performance and enables the participants to share in the Company’s success, and is measured based on net profit growth and profit margin. The plan vests over a period of a three years performance cycle. The Company's actual performance is assessed at the end of each year during the vesting period.The LTIP scheme is an entirely equity-settled share based scheme under which the approved participants will receive Bupa Arabia shares after the completion of each three year performance period, the achievement of the performance measures, the achievement of the participant’s conditions, and the completion of the required approvals. The LTIP scheme is supervised by the Nomination and Remuneration Committee (N&RC) after being approved by the Board of Directors.The cost of the plan is recognised over the period in which the service condition is fulfilled, ending on the date on which the relevant employees become fully entitled to the plan ('the vesting date'). The expense, recognised for the plan at each reporting date until the vesting date, reflects the Company's best estimate of the number of equity instruments that will ultimately vest. The charge or credit for a year represents the movement in cumulative expense recognised as at the beginning and end of that year.The total LTIP expense recognised for employees' services received is charged to the statement of income with a corresponding increase in the statement of changes in equity, as per the requirements of IFRS 2 ‘Share Based Payments’. Any dividend distributions on the award shares during the vesting period are accumulated and transferred to the participants upon vesting.The Company has a practice to reflect the grant date as the date of completion of the total LTIP shares purchases for the relevant cycle each year and to retain the LTIP shares with an investment broker, currently NCB Capital.The LTIP transaction details are provided below:Month/PeriodNumber of shares purchased / (delivered/disposed) – netThe grant date fair value of the sharesAmount31 December 2018 SR’000July 201532,1102778,901November 201518,9932214,200December 2015*51,103---March 201692,66911510,693March 2016(2,814)139(390)March 2017(34,346)139(4,761)March 2017(6,825)115(788)June 201796,49111511,060March 2018(10,210)139(1,415)May 2018(37,986)111(4,200)June 2018**(15,378)139(2,132)September 2018***121,8169411,494November 2018****152,811---Total458,43432,662* During December 2015, the Company issued Bonus shares, one per each issued share, and as a result received an additional 51,103 LTIP shares.** The 2015-2017 LTIP Scheme’s shares have been fully delivered to all entitled executives following the approval of the Board Nomination and Remuneration Committee.*** The LTIP Scheme shares purchase value for the 2018-2020 cycle was formally approved by the shareholders in the General Assembly meeting of 31 May 2018 and these LTIP shares purchases were partially completed on 12 June 2018, at an average purchase price per share of SR 97, and the remaining required LTIP shares purchases for this cycle were completed on 4 September 2018, at an average purchase price per share of SR 90,**** During November 2018, the Company issued Bonus shares, one for every two issued share, and as a result received an additional 152,811 LTIP shares. | 29 |
| Disclosure of claims/ benefits development table [text block] | The following table reflects the estimated ultimate claim cost, including claims notified and incurred but not reported for each successive treatment year at each financial position date, together with the cumulative payments to date. The development of insurance liabilities provides a measure of the Company's ability to estimate the ultimate value of the claims. The Company aims to maintain adequate reserves in respect of its insurance business in order to protect against adverse future claims experience and developments. As claims develop and the ultimate cost of claims becomes more certain, adverse claims experiences will be eliminated which results in the release of reserves from earlier treatment years. In order to maintain adequate reserves, the Company transfers much of this release to the current treatment year reserves when the development of claims is less mature and there is much greater uncertainty attached to the ultimate cost of claims.Treatment year –gross outstanding claims2015201620172018TotalSR ‘000Estimate of ultimate claims cost:At the end of treatment year5,399,1706,319,9296,577,9196,949,081One year later5,275,3556,210,2696,572,947--Two years later5,275,9806,212,870----Three years later5,271,081------Current estimate of ultimate claims5,271,0816,212,8706,572,9476,949,08125,005,979Ultimate payments to date(5,270,587)(6,209,074)(6,527,788)(5,545,249)(23,552,698)Liability recognised in the statement of financial position4943,79645,1591,403,8321,453,281Claims handling provision19,400Balance at 31 December1,472,681Treatment year –net outstanding claimsSR ‘000Estimate of ultimate claims cost:At the end of treatment year5,348,2756,318,2096,576,8896,946,067One year later5,275,3556,210,2696,572,947--Two years later5,275,9806,212,870----Three years later5,271,081------Current estimate of ultimate claims5,271,0816,212,8706,572,9476,946,06725,002,965Ultimate payments to date(5,270,587)(6,209,074)(6,527,788)(5,545,249)(23,552,698)Liability recognised in the statement of financial position4943,79645,1591,400,8181,450,267Claims handling provision19,400Balance at 31 December1,469,667 | 15 |
| Disclosure of commitments and contingencies, general [text block] | The Company’s commitments and contingencies are as follows:20182017SR’000SR’000Letters of guarantee26,34632,682Operating commitments150,363169,764176,709202,446i) The Company is subject to legal proceedings in the ordinary course of business. There was no material change in the status of legal proceedings from 31 December 2017.ii) As of 31 December 2018, total Letters of Guarantee issued by banks amounted to SR 94.7 million, of which SR 26.37 million (2017: SR 32.68 million) are issued against restricted deposits with banks and have been recorded under prepayments and other assets. | 17 |
| Disclosure of risk management [abstract] | | |
| Disclosure of insurance/ takaful risk [text block] | The Company provides short-term health insurance contracts in Saudi Arabia. Accordingly, the main insurance Risk within the Company is the claims reserve risk resulting from fluctuations in the estimated ultimate claims. The Company seeks to manage this through close monitoring of the claims’ trend and payments’ pattern to ensure that sufficient reserves are available to cover claim liabilities. The Company also have an external actuary to perform quarterly independent reviews of the reserves adequacy.The Company has a reinsurance arrangement to reduce its exposure through transfer of risk. The reinsurance agreement is an excess of loss treaty per person per claim on losses occurring basis.i) The ultimate liability arising from claims made under insurance contractsClaims reserves which are key components of the Company’s ultimate liability are estimated amounts of the outstanding claims, incurred but not reported claims (“IBNR”) and claims handling provisions. These reserves do not represent exact calculations but rather expectations based on historical claims’ trend (frequency and severity), payments’ pattern, medical inflation, members’ behaviour, seasonality and other factors.The Company has a large insurance portfolio resulting in stable claims development patterns which relatively reduces the risk of fluctuations in the estimated ultimate claims. The short-tailed nature of the business is associated with higher consistency of the reserve estimates. The Company continually review the adequacy of claims reserves by conducting back-testing analysis, assessing the sufficiency of data, monitoring claims backlogs and settlement patterns. In addition, the external actuary runs independent valuation models after due reconciliation with financial statements to validate reserve adequacy.ii) Concentration of insurance riskThe insurance risk exposure related to policyholders is mainly concentrated in Saudi Arabia. However, through its underwriting strategy, the Company ensures that the portfolio is well diversified and not concentrated within few large clients. Its business is proportionally spread across all regions in the Saudi Arabia, and the Company targets both corporate and retail business. The insurance portfolio is not concentrated in a specific benefit level (diverse medical providers, different deductibles, annual limits and sub-limits).iii) Process used to decide on assumptionsThe pricing team follows the Company’s underwriting guidelines (approved by the Board of Directors) in setting premiums taking into consideration credible claims experiences for both new business and renewals or medical declarations.Assumptions used in determining claims reserves are based on the best estimate. Ultimate claims are estimated using historical claim trends adjusted for inflation, seasonality, membership growth and any other external or internal factors that may have impact on claim costs. Given the nature of the business, the Company may still be exposed to risk of insufficiency of claim reserves for which actual claim cost may turn out to be higher than the initial estimated ultimate claims.The estimation of IBNR is generally subject to a greater degree of uncertainty than the estimation of the outstanding claims which are received but not yet settled with the providers. For the case of outstanding claims, the Company uses payment information of settled batches with providers to estimate the expected settlement amounts of recently submitted batches, while it uses mainly pre-authorization data to estimate IBNR. The Company seeks to avoid inadequate reserve levels by adopting established processes in determining claim reserve and using updated information from both claims received and pre-authorization data.The premium liabilities have been determined as such that the total premium liability provisions (unearned premium reserve and premium deficiency reserve, if applicable and required as per the result of the liability adequacy test) would be sufficient to service the future expected claims and expenses likely to occur on the unexpired policies. The expected future liability is determined using the Company’s loss ratio adjusted for seasonality and portfolio mix for the remaining unearned period. The details of estimation of the outstanding claims and premium deficiency reserves are given under Notes 2(d)(i).iv) Sensitivity analysisThe Company believes that the claim liabilities under insurance contracts outstanding at year end are adequate. However, these amounts are not certain and actual payments may differ from the claims liabilities provided in the financial statements. The insurance claim liabilities are sensitive to the various assumptions. It has not been possible to quantify the sensitivity of specific variable such as legislative changes or uncertainty in the estimation process.An assumed 5% change in the claim ratio, net of reinsurance, would impact net underwriting income as follows:20182017SR’000SR’000Impact of change in claim ratio by 5% 407,512 383,616 | 36A |
| Disclosure of reinsurance/ retakaful risk [text block] | b) Reinsurance riskThe Company has a reinsurance arrangement to reduce its exposure through transfer of insurance risk. The reinsurance agreement is an excess of loss treaty per person per claim on losses occurring basis. Such arrangement protects the Company from large claims with a reasonable ceded premium given the stable underwriting performance and the size of the insurance portfolio.The Reinsurers are selected based on the following criteria:- All reinsurers should meet SAMA’s minimum acceptable rating of BBB (S&P Rating).- The reinsurers’ panel and the agreement should be reviewed and approved by the Company’s Board of Directors.Reinsurance ceded business does not relieve the Company from its obligations to policyholders and as a result the Company remains liable for the portion of outstanding claims reinsured to the extent that the reinsurer fails to meet the obligations under the reinsurance agreements. | 36B |
| Disclosure of market risk [text block] | Market risk refers to the potential impact of various market dynamics on the fair value or the expected cash flows of financial instruments. The Company adopts asset allocation guidelines and diversification limits on asset classes, geographies, currencies and securities to ensure that market risk is contained and kept to minimal levels.The Board of Directors sets the overall risk appetite to a prudent level that does not impact the Company’s operating results. The management prepares monthly and quarterly reports, highlighting deployment activities and exposure limits to ensure that appropriate monitoring and compliance with the approved guidelines. Management performs continuous assessment of developments in relevant markets to ensure that market risk is monitored and mitigated at the asset class and securities levels.Market risk comprises three types: interest rate risk, price risk and currency risk.i) Interest rate riskInterest rate risk is the potential change in the fair value of financial instruments and expected cash flows as a result of changes in interest rates. Management constantly monitors developments in global and local interest rates and accordingly allocates the durations of its term deposits and sukuk investments.Investments in term deposits and sukuk instruments have various maturities in order to maximize investment returns while ensuring that liquidity requirements are continuously met. Details of maturities of interest bearing securities as at 31 December are as follows:2018Less than 3 months3 months to 1 year1 year to3 yearsMore than 3 yearsTotalSR’000Term deposits1,203,0101,885,7841,476,487150,0004,715,281Investments in Sukuk2,00050,774260,223805,3401,118,3371,205,0101,936,5581,736,710955,3405,833,6182017Less than 3 months3 months to 1 year1 year to3 yearsMore than 3 yearsTotalSR’000Term deposits797,5212,171,247776,615200,0003,945,383Investments in Sukuk--37,580168,695681,390887,665797,5212,208,827945,310881,3904,833,048ii) Price riskPrice risk is the potential change in the fair value of financial instruments as a result of instrument-specific developments or systemic factors affecting the overall market in which the instrument is being traded.The total size of investments which are exposed to market price risk is SR 1,621 million (2017: SR 1,721 million). The Company manages this risk conducting thorough due diligence on each instrument prior to investing as well as maintaining exposure limits guidelines to minimize the potential impact of marking to market on the overall portfolio.The potential impact of a 10% increase or decrease in the market prices of investments on Company's profit would be as follows:Fair value changeEffect on Company’s profit SR’0002018 10% 38,0422017 10% 90,741The above sensitivity analysis is only on FVIS investments which directly impact the Company’s profit.iii) Currency riskCurrency risk is the potential fluctuation of the value of a financial instrument due to changes in foreign exchange rates. All Company’s transactions are in Saudi Arabian Riyals and US Dollar. Given the peg of Saudi Arabian Riyals and US Dollars, foreign exchange risk is minimal. | 36C |
| Disclosure of credit risk [text block] | Credit risk is the risk that one party to a financial instrument will fail to discharge an obligation and cause the other party to incur a financial loss.The Company seeks to manage its credit risk with respect to customers by following the Company’s credit control policy and monitoring outstanding receivables on an on-going basis in order to reduce the Company’s exposure to bad debts. The management estimates specific impairment provisions on a case by case basis. In addition to specific provisions, the Company also makes an additional portfolio provision, estimated on a collective basis, based on the ageing profile of the premiums receivable. The Company seeks to limit its credit risk with respect to other counterparties by placing term deposits and investments with reputable financial institutions. The Company enters into reinsurance contracts with recognised, creditworthy third parties (rated A or above).The following table shows the maximum exposure to credit risk by class of financial asset:20182017SR’000SR’000Cash and cash equivalents290,413229,884Premiums receivable – net950,671870,982Reinsurers’ share of outstanding claims336360Reinsurers’ share of claims incurred but not reported2,678670Investments1,621,4911,721,690Other receivables151,734132,535Term deposits4,715,2813,945,383Statutory deposit120,00080,000Accrued income on statutory deposit6,8825,1217,859,4866,986,625The table below provides information regarding the credit risk exposure of the Company by classifying assets according to the Company’s credit rating of counterparties. Investment grade ratings refers to companies with sound credit standing of AAA to BBB- (as per S&P) and/or Aaa to Baa3 (as per Moody’s). Ratings below the mentioned threshold are considered sub-investment grade with a higher default risk.2018Non-investment gradeInvestment gradeNot impairedImpairedTotalSR’000Cash and cash equivalents290,413----290,413Premiums receivable – net--637,196313,475950,671Reinsurer’s share of outstanding claims336----336Reinsurers’ share of claims Incurred but not reported2,678----2,678Investments1,621,491----1,621,491Other receivables149,506----149,506Term deposits4,715,281----4,715,281Statutory deposit120,000----120,000Accrued income on statutory deposit6,882----6,8826,906,587637,196313,4757,857,2582017Non-investment gradeInvestment gradeNot impairedImpairedTotalSR’000Cash and cash equivalents229,884----229,884Premiums receivable – net--611,323259,659870,982Reinsurer’s share of outstanding claims360----360Reinsurers’ share of claims Incurred but not reported670----670Investments1,721,690----1,721,690Other receivables130,063----130,063Term deposits3,945,383----3,945,383Statutory deposit80,000----80,000Accrued income on statutory deposit5,121----5,1216,113,171611,323259,6596,984,153 | 36D |
| Disclosure of liquidity risk [text block] | Liquidity risk is the risk that the Company will not be able to meet its operational or financial obligations when they are due. Liquidity requirements are monitored on monthly basis and management ensures that sufficient liquid funds are available to meet any commitments as they arise.Unearned premiums have been excluded from the analysis as they are not contractual obligations. The table below summarizes the maturity profile of the financial liabilities of the Company based on remaining expected undiscounted contractual obligations:2018Up to one yearMore than one yearTotalSR’000Accrued and other liabilities204,41481,395285,809Reinsurers' balances payable50,636--50,636Outstanding claims555,158--555,158Claims incurred but not reported898,123--898,123Claims handling reserve19,400--19,400Due to related parties41,095--41,095Provision for end-of-service benefits7,87173,52481,395Zakat and income tax2,403197,381199,784Accrued income payable to SAMA--6,8826,8821,779,100359,1822,138,2822017Up to one yearMore than one yearTotalSR’000Accrued and other liabilities79,12966,469145,598Reinsurers' balances payable39,613--39,613Outstanding claims450,249--450,249Claims incurred but not reported871,998--871,998Claims handling reserve19,289--19,289Due to related parties33,586--33,586Provision for end-of-service benefits10,22256,24766,469Zakat and income tax10,841137,863148,704Accrued income payable to SAMA--5,1215,1211,514,927265,7001,780,627i) Liquidity profileAll assets excluding investments, fixtures, furniture and equipment, intangible assets, goodwill, statutory deposit and accrued income on statutory deposit, are expected to be recovered or settled after one year. Term deposits amounting to SR 3,142 Million (31 December 2017: SR 3,006 Million) mature within one year and the remaining balance have maturities greater than one year.None of the financial liabilities on the statement of financial position are based on discounted cash flows ,with exception of defined benefit obligation and are all payable on a basis as set out above. There are no differences between contractual and expected maturity of the financial liabilities of the Company. | 36E |
| Disclosure of operational/ process risk [text block] | Operational risk is the risk of direct or indirect loss arising from a wide variety of causes associated with the processes, technology and infrastructure supporting the Company’s operations either internally within the Company or externally at the Company’s service providers, and from factors other than credit, market and liquidity risks such as those arising from regulatory requirements. Operational risks arise from all of the Company’s activities.The Company’s objective is to manage operational risk so as to balance limiting of financial losses and damage to its reputation with achieving its investment objective of generating returns for investors. The primary responsibility for the development and implementation of controls over operational risk rests with the Board of Directors. This responsibility encompasses the controls in the following areas:- Requirements for appropriate segregation of duties between various functions, roles and responsibilities;- Requirements for the reconciliation and monitoring of transactions;- Compliance with regulatory and other legal requirements;- Documentation of controls and procedures;- Requirements for the periodic assessment of operational risks, and the adequacy of controls and procedures to address those risks;- Ethical and business standards; and- Risk mitigation policies and procedures. | 36F |
| Disclosure of fair value of financial assets and liabilities [text block] | Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction takes place either:- in the accessible principal market for the asset or liability, or- in the absence of a principal market, in the most advantageous accessible market for the asset or liability.a) Determination of fair value and fair value hierarchyThe Company uses the following hierarchy for determining and disclosing the fair value of financial instruments:Level 1: quoted prices in active markets for the same or identical instrument that an entity can access at the measurement date;Level 2: quoted prices in active markets for similar assets and liabilities or other valuation techniques for which all significant inputs are based on observable market data; andLevel 3: valuation techniques for which any significant input is not based on observable market data.b) Carrying amounts and fair valueThe following table shows the carrying amount and fair value of financial assets, including their levels in the fair value hierarchy for financial instruments measured at fair value. It does not include fair value information for financial assets and financial liabilities not measured at fair value if the carrying amount is a reasonable approximation to fair value.Fair valueLevel 1Level 2Level 3TotalCarrying valueSR’0002018Financial assets measured at fair value- Investments held as FVSI16,021364,373--380,394380,394- Available-for-sale investments842,262398,835--1,241,0971,241,097858,283763,208--1,621,4911,621,491Fair valueLevel 1Level 2Level 3TotalCarrying valueSR’0002017Financial assets measured at fair value- Investments held as FVSI106,290801,117--907,407907,407- Available-for-sale investments453,157361,126--814,283814,283559,4471,162,243--1,721,6901,721,690c) Measurement of fair valueValuation technique and significant unobservable inputsThe following table shows the valuation techniques used in measuring Level 2 fair value at 31 December 2018 and 31 December 2017, as well as the significant unobservable inputs used.TypeValuation techniqueSignificantunobservable inputsInter-relationship between significant unobservable inputs and fair value measurementFloating rate sukuks and mutual fundsValuations are based on quotations as received by the custodians at the end of each period and on published net asset value (NAV) closing prices.Not applicableNot applicable | 22 |
| Disclosure of comparative figures [text block] | Certain comparative figures have been reclassified and regrouped to conform with the current year’s presentation as disclosed in note 2 to these financial statements.The amounts “due to/from” shareholders and insurance operations which were previously reported separately in the respective statement of financial position, are now eliminated. In addition the 90/10 split of the surplus from insurance operations between shareholders and insurance operations are presented separately in the supplementary information (refer to note 37 above). | 38 |
| Disclosure of board of director's approval of the financial statements [text block] | The financial statements have been approved by the Board of Directors, on 5 Rajab 1440H corresponding to 12 March 2019. | 39 |
| Disclosure of other notes relevant to understanding of financial statements [text block] | 16. FIDUCIARY ASSETS During the year ended 31 December 2018, after having SAMA’s approval, the Company entered into a Third Party Administration agreement (TPA) with a customer under which the Company facilitates healthcare services to the employees of the customer with specific terms and conditions. The agreement is effective from 1 March 2018. The services are remunerated against administration fees. In order to fulfil the commitment relating to this agreement, the Company has received funds in advance from the customer to settle anticipated claims from medical service providers. As the Company acts as an agent, the relevant bank balance and outstanding claims at the reporting date are offset in the statement of financial position. The assets and liabilities held in fiduciary capacity amounted to SR 194.8 million as of 31 December 2018 (2017: nil).4. GOODWILL On 31 December 2008, the Company entered into an agreement with Bupa Middle East Limited E.C. (the “Seller”), a related party, pursuant to which it acquired the Seller’s insurance operations in the Kingdom of Saudi Arabia, effective from 1 January 2009. The acquisition transaction was approved by SAMA and resulted in goodwill of SR 98 million. The entire amount was paid in the previous years, to the Seller, after obtaining the required regulatory approvals. In accordance with the requirements of International Financial Reporting Standards, the Company’s management annually carry out an annual impairment test in respect of the above mentioned goodwill. Management conducted the impairment exercise for the year ended 31 December 2018. The recoverable amount of operations has been determined based on value in use. The two key assumptions used in the test are the discount rate and estimated future cash flows from the business as follows: An average discount rate of 12% was used to discount future cash flows. EBTIDA growth rate of 11.6% was used for the first three years. Thereafter, a growth rate of 3% was used in the terminal value calculation. A change in discount rate by 300 basis point with other variables held constant would not result in impairment of goodwill. 11. INTANGIBLE ASSETS Software Capital work in progress* Total SR’000 Cost: At 1 January 2017 57,571 8,969 66,540 Additions during the year 8,651 19,612 28,263 Disposals/transfers during the year 10,289 (10,289) -- At 1 January 2018 76,511 18,292 94,803 Additions during the year 6,072 14,977 21,049 Disposal during the year (238) -- (238) Transfers during the year 1,102 3,314 4,416 At 31 December 2018 83,447 36,583 120,030 Accumulated amortization: At 1 January 2017 49,174 -- 49,174 Charge for the year 5,749 -- 5,749 At 1 January 2018 54,923 -- 54,923 Charge for the year 8,072 -- 8,072 Disposal during the year (238) -- (238) At 31 December 2018 62,757 -- 62,757 Net book value: At 31 December 2018 20,690 36,583 57,273 At 31 December 2017 21,588 18,292 39,880 | 16 & 4 &11 |
| Disclosure of fees and commission income [text block] | TRADE MARK FEES:During 2010, the Company entered into an agreement with a related party for obtaining a license to use the trade marks (the word Bupa with or without logo) of the related party. As per the terms of the agreement, the trade mark fee is payable at different rates linked to the results of the Company, subject to a maximum of 5% of the Company’s profits in any financial year, as trade-mark fees. Accordingly, a sum of SR 20.5 million (2017: SR 19.3 million) payable to a related party has been accrued for during the year (see notes 24 and 32). | 19 |
