| Notes forming part of accounts [line items] | | |
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| Disclosure of general information about reporting entity [abstract] | | |
| Disclosure of general information about reporting entity [text block] | Wataniya Insurance Company (the “Company”) is a Saudi Joint Stock Company incorporated in the Kingdom of Saudi Arabia under Commercial Registration No. 4030200981 dated 1 Jumada II 1431H (corresponding to May 15, 2010) and Ministry of Commerce &Investment’s Resolution number 158/K dated Jumad-ul-Awal 12, 1431H (corresponding to April 26, 2010). The Registered Office address of the Company is Juffali Building, Madina Road, Jeddah, Saudi Arabia.The Company is licensed to conduct insurance business in Saudi Arabia under Cooperative insurance principles in accordance with Royal Decree No M/53 dated 21 Shawwal 1430H (corresponding to October 10, 2009) pursuant to Council of Ministers’ Resolution No. 330 dated Shawwal 16,1430H (corresponding to October 5, 2009). The Company was listed on the Saudi Arabian stock exchange (Tadawul) on September 6, 2010. The objectives of the Company are to provide general insurance and related services in accordance with its by-laws and applicable regulations in the Kingdom of Saudi Arabia. | 1 |
| Disclosure of basis of preparation of financial statements [text block] | (a)Statement of compliance The interim condensed financial statements of the Company have been prepared in accordance with ‘International Accounting Standard 34 - Interim Financial Reporting ("IAS 34") as endorsed in the Kingdom of Saudi Arabia and other standards and pronouncement issued by Saudi Organisation for Certified Public Accountants (“SOCPA”). The interim condensed financial statements are prepared under the going concern basis and the historical cost convention, except for the measurement of investments at their fair value. The Company’s interim condensed statement of financial position is presented in order of liquidity. Except for property and equipment, intangible assets, statutory deposit, end-of-service indemnities and warranty and engineering related unearned premiums, unearned reinsurance commission, deferred policy acquisition cost, outstanding claims, claims incurred but not reported and technical reserves, all other assets and liabilities are of short-term nature, 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 clearly attributable to either operation, are recorded in the respective accounts. The interim statements of financial position, statement of income, comprehensive income and cash flows of the insurance operations and shareholders operations which are presented in Note 21 have been provided as supplementary information to comply with requirements of the guidelines issued by SAMA Implementing Regulations and is not required by International Financial Reporting Standards (IFRS).The interim condensed financial statements may not be considered indicative of the expected results for the full year.The interim condensed financial statements are expressed in Saudi Arabian Riyals (SR) and are rounded off to the nearest thousands.The interim condensed financial information do not include all of the information required for full annual financial information and should be read in conjunction with the annual financial statement as of and for the year ended December 31, 2019.(b) Critical accounting judgments estimates and assumptions The preparation of interim condensed financial statements requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense, and the accompanying disclosures, and the disclosure of contingent liabilities. Actual results may differ from these estimates. However, the Company has reviewed the key sources of estimation uncertainties disclosed in the last annual financial statements against the backdrop of the COVID-19 pandemic. For further details please see note 22 to these interim condensed financial statements. Management will continue to assess the situation and reflect any required changes in future reporting periods.(c) Seasonality of operations There are no seasonal changes that may affect insurance of the Company. | 2 |
| Disclosure of new standards and amendments in standards [text block] | The accounting policies used in the preparation of these interim condensed financial statements are consistent with those used in the preparation of the annual financial statements for the year ended December 31, 2019 except as explained below:New IFRS, International Financial Reporting and Interpretations Committee’s interpretations (IFRIC) and amendments thereof, adopted by the CompanyThe following new standards, interpretations, amendments and revisions to existing standards, which were issued by the International Accounting Standards Board (IASB) have been effective from January 1, 2020, as applicable:Amendments to IAS 39 and IFRS 7: Interest Rate Benchmark ReformThe amendments to and IAS 39 ‘Financial Instruments: Recognition and Measurement’ provide a number of reliefs, which apply to all hedging relationships that are directly affected by interest rate benchmark reform. A hedging relationship is affected if the reform gives rise to uncertainties about the timing and or amount of benchmark-based cash flows of the hedged item or the hedging instrument. These amendments had no impact on the interim condensed financial statements of the Company as it does not have any interest rate hedge relationships.Amendments to IAS 1 and IAS 8: Definition of MaterialThe amendments provide a new definition of material that states “information is material if omitting, misstating or obscuring it could reasonably be expected to influence decisions that the primary users of general purpose financial statements make on the basis of those financial statements, which provide financial information about a specific reporting entity.” The amendments clarify that materiality will depend on the nature or magnitude of information, either individually or in combination with other information, in the context of the financial statements. A misstatement of information is material if it could reasonably be expected to influence decisions made by the primary users. These amendments had no impact on the interim condensed financial statements of, nor is there expected to be any future impact to the Company.Amendments to IFRS 3: Definition of a businessThe amendment to IFRS 3 clarifies that to be considered a business, an integrated set of activities and assets must include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create output. Furthermore, it clarified that a business can exist without including all of the inputs and processes needed to create outputs. These amendments had no impact on the interim condensed financial statements of the Company but may impact future periods should the Company enter into any business combinations.Conceptual Framework for Financial Reporting issued on March 29, 2018The Conceptual Framework is not a standard, and none of the concepts contained therein override the concepts or requirements in any standard. The purpose of the Conceptual Framework is to assist the IASB in developing standards, to help preparers develop consistent accounting policies where there is no applicable standard in place and to assist all parties to understand and interpret the standards. The revised Conceptual Framework includes some new concepts, provides updated definitions and recognition criteria for assets and liabilities and clarifies some important concepts. These amendments had no impact on the interim condensed financial statements of the Company.Standards issued but not yet effectiveStandards issued but not yet effective up to the date of issuance of the Company’s interim condensed financial statements are listed below. The listing is of standards and interpretations issued, which the Company reasonably expects to be applicable at a future date. The Company intends to adopt these standards when they become effective.Standard/InterpretationDescriptionEffective from periods beginning on or after the following dateIFRS 9Financial Instruments (note below)See note belowIFRS 17Insurance Contracts 1 January 2023IFRS 9 – Financial instrumentsThis standard was published on July 24, 2014 and has replaced IAS 39. The new standard addresses the following items related to financial instruments:a) Classification and measurementIFRS 9 uses a single approach to determine whether a debt financial asset is measured at amortized cost, fair value through other comprehensive income or fair value through profit or loss. A debt financial asset is measured at amortized cost if both:i. the asset is held within a business model whose objective is to hold assets in order to collect contractual cash flows; andii. the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding (“SPPI”).The financial asset is measured at fair value through other comprehensive income and realized gains or losses would be recycled through profit or loss upon sale, if both conditions are met:i. the asset is held within a business model whose objective is to hold assets in order to collect contractual cash flows and for sale; andii. the contractual terms of cash flows are SPPI.Debt financial assets not meeting either of these categories are measured at fair value through profit or loss. Additionally, at initial recognition, an entity can use the option to designate a financial asset, both debt and equity instrument at fair value through profit or loss if doing so eliminates or significantly reduces an accounting mismatch.For equity instruments that are not held for trading, an entity can also make an irrevocable election on initial recognition, to present in other comprehensive income subsequent changes in the fair value of the instruments (including realized gains and losses on disposal), dividends being recognized in statement of income.Additionally, for financial liabilities that are designated as at fair value through profit or loss, the amount of change in the fair value of the financial liability that is attributable to changes in the credit risk of that liability is recognized in other comprehensive income, unless the recognition of the effects of changes in the liability’s credit risk in other comprehensive income would create or enlarge an accounting mismatch in statement of income.b) ImpairmentThe impairment model under IFRS 9 reflects expected credit losses, as opposed to incurred credit losses under IAS 39. Under the IFRS 9 approach, it is no longer necessary for a credit event to have occurred before credit losses are recognized. Instead, an entity always accounts for expected credit losses and changes in those expected credit losses. The amount of expected credit losses is updated at each reporting date to reflect changes in credit risk since initial recognition.c) Hedge accountingIFRS 9 introduces new requirements for hedge accounting that align hedge accounting more closely with Risk Management. The requirements establish a more principles-based approach to the general hedge accounting model. The amendments apply to all hedge accounting with the exception of portfolio fair value hedges of interest rate risk (commonly referred to as “fair value macro hedges”). For these, an entity may continue to apply the hedge accounting requirements currently in IAS 39. This exception was granted largely because the IASB is addressing macro hedge accounting as a separate project.Effective dateThe published effective date of IFRS 9 was January 1, 2018. However, amendments to IFRS 4 – Insurance Contracts: Applying IFRS 9 – Financial Instruments with IFRS 4 – Insurance Contracts, published on September 12, 2016, changes the existing IFRS 4 to allow entities issuing insurance contracts within the scope of IFRS 4 to mitigate certain effects of applying IFRS 9 before the IASB’s new insurance contract standard (IFRS 17 – Insurance Contracts) becomes effective. The amendments introduce two alternative options:1.Apply a temporary exemption from implementing IFRS 9 until the earlier of:a)the effective date of a new insurance contract standard; orb)annual reporting periods beginning on or after January 1, 2021. The IASB is proposing to extend the effective date of IFRS 17 and the IFRS 9 temporary exemption in IFRS 4 to January 1, 2022. Additional disclosures related to financial assets are required during the deferral period. This option is only available to entities whose activities are predominately connected with insurance and have not applied IFRS 9 previously; or2.Adopt IFRS 9 but, for designated financial assets, remove from profit or loss the effects of some of the accounting mismatches that may occur before the new insurance contract standard is implemented. During the interim period, additional disclosures are required.The Company has performed a detailed assessment beginning January 1, 2018: (1) The carrying amount of the Company’s liabilities arising from contracts within the scope of IFRS 4 (including deposit components or embedded derivatives unbundled from insurance contracts) were compared to the total carrying amount of all its liabilities; and (2) the total carrying amount of the Company’s liabilities connected with insurance were compared to the total carrying amount of all its liabilities. Based on these assessments the Company determined that it is eligible for the temporary exemption. Consequently, the Company has decided to defer the implementation of IFRS 9 until the effective date of the new insurance contracts standard. Disclosures related to financial assets required during the deferral period are included in the Company’s annual financial statements.Impact assessmentOverall, the Company expects some impact of applying the impairment requirements of IFRS 9 on the financial statements of the Company. However, the impact of the same is not expected to be significant. At present it is not possible to provide reasonable estimate of the effects of application of this new standard as the Company is yet to perform a detailed review. IFRS 17 – Insurance ContractsOverviewThis standard has been published on May 18, 2017, it establishes the principles for the recognition, measurement, presentation and disclosure of insurance contracts and supersedes IFRS 4 – Insurance contracts.The new standard applies to insurance contracts issued, to all reinsurance contracts and to investment contracts with discretionary participating features provided the entity also issues insurance contracts. It requires to separate the following components from insurance contracts:i.embedded derivatives, if they meet certain specified criteria;ii.distinct investment components; andiii.any promise to transfer distinct goods or non-insurance services.These components should be accounted for separately in accordance with the related standards (IFRS 9 and IFRS 15). MeasurementIn contrast to the requirements in IFRS 4, which permitted insurers to continue to use the accounting policies for measurement purposes that existed prior to January 2015, IFRS 17 provides the following different measurement models:1)The General Measurement Model (GMM) is based on the following “building blocks”:a)the fulfilment cash flows (FCF), which comprises:probability-weighted estimates of future cash flows;an adjustment to reflect the time value of money (i.e. discounting) and the financial risks associated with those future cash flows; and a risk adjustment for non-financial risk.b)the Contractual Service Margin (CSM). The CSM represents the unearned profit for a group of insurance contracts and will be recognized as the entity provides services in the future. The CSM cannot be negative at inception; any net negative amount of the fulfilment cash flows at inception will be recorded in profit or loss immediately. At the end of each subsequent reporting period the carrying amount of a group of insurance contracts is remeasured to be the sum of:the liability for remaining coverage, which comprises the FCF related to future services and the CSM of the group at that date; andthe liability for incurred claims, which is measured as the FCF related to past services allocated to the group at that date.The CSM is adjusted subsequently for changes in cash flows related to future services but the CSM cannot be negative, so changes in future cash flows that are greater than the remaining CSM are recognized in profit or loss. Interest is also accreted on the CSM at rates locked in at initial recognition of a contract (i.e. discount rate used at inception to determine the present value of the estimated cash flows). Moreover, the CSM will be released into profit or loss based on coverage units, reflecting the quantity of the benefits provided and the expected coverage duration of the remaining contracts in the group.2)The Variable Fee Approach (VFA):VFA is a mandatory model for measuring contracts with direct participation features (also referred to as ‘direct participating contracts’). This assessment of whether the contract meets these criteria is made at inception of the contract and not reassessed subsequently. For these contracts, the CSM is also adjusted for in addition to adjustment under general model:i.changes in the entity’s share of the fair value of underlying items;ii.changes in the effect of the time value of money and financial risks not relating to the underlying items.In addition, a simplified Premium Allocation Approach (PAA) is permitted for the measurement of the liability for the remaining coverage if it provides a measurement that is not materially different from the general model or if the coverage period for each contract in the group is one year or less. With the PAA, the liability for remaining coverage corresponds to premiums received at initial recognition less insurance acquisition cash flows. The general model remains applicable for the measurement of incurred claims. However, the entity is not required to adjust future cash flows for the time value of money and the effect of financial risk if those cash flows are expected to be paid/received in one year or less from the date the claims are incurred.Effective dateThe IASB issued an Exposure Draft Amendments to IFRS 17 during June 2019 and received comments from various stakeholders. The IASB is currently re-deliberating issues raised by stakeholders. For any proposed amendments to IFRS 17, the IASB will follow its normal due process for standard-setting. The effective date of IFRS 17 and the deferral of the IFRS 9 temporary exemption in IFRS 4, is currently January 1, 2021. Under the current draft, IFRS 17 effective date is amended to reporting periods beginning on or after January 1, 2023. This is a deferral of 2 years compared to the previous date of January 1, 2021. Earlier application is permitted if both IFRS 15 – Revenue from Contracts with Customers and IFRS 9 – Financial Instruments have also been applied. The Company intend to apply the standard on its effective date.TransitionRetrospective application is required. However, if full retrospective application for a group of insurance contracts is impracticable, then the entity is required to choose either a modified retrospective approach or a fair value approach.Presentation and DisclosuresThe Company expects that the new standard will result in a change to the accounting policies for insurance contracts together with amendments to presentation and disclosures. Impact assessmentThe Company is currently assessing the impact of the application and implementation of IFRS 17. As of the date of the publication of these interim condensed financial statements, the financial impact of adopting the standard is yet to be fully assessed by the Company. The Company has undertaken a Gap Analysis and the key Gaps are as follows: Impact areaSummary of impactFinancial impactNot yet fully assessed by the Company.Data impactThe Company believes that the data impact is not likely to be significant as a major proportion of the Company’s business would qualify for measurement under the premium allocation approach.IT systemsWith respect to IT systems, the Company has short listed a vendor to provide the necessary technical support to ensure an effective implementation of IFRS 17. The current accounting chart of accounts is under review for amendments to comply with IFRS 17 requirements. In addition, new disclosures will need to be developed.Process impactThe process impact is under evaluation, but no significant process changes are anticipated. However, should the Company shift its focus to majority long term business, the process impact would be significant.Impact on reinsurance arrangementsThe Company’s reinsurance arrangements under the proportional treaties currently are under testing to determine the suitable measurement approach.Impact on policies & control’s frameworksThe Company has hired an external consultant to modify their current policies control framework, to be more compliant towards the requirements of IFRS 17.Human resources The Company intends to recruit suitably qualified personnel who have a comprehensive understanding of the IFRS 17. The Company also intends to provide adequate training to existing staff.The Company has started with their implementation process and have set up a proper team, supervised by a steering committee. | 3 |
| Disclosure of issued IFRS not yet adopted [text block] | The accounting policies used in the preparation of these interim condensed financial statements are consistent with those used in the preparation of the annual financial statements for the year ended December 31, 2019 except as explained below:New IFRS, International Financial Reporting and Interpretations Committee’s interpretations (IFRIC) and amendments thereof, adopted by the CompanyThe following new standards, interpretations, amendments and revisions to existing standards, which were issued by the International Accounting Standards Board (IASB) have been effective from January 1, 2020, as applicable:Amendments to IAS 39 and IFRS 7: Interest Rate Benchmark ReformThe amendments to and IAS 39 ‘Financial Instruments: Recognition and Measurement’ provide a number of reliefs, which apply to all hedging relationships that are directly affected by interest rate benchmark reform. A hedging relationship is affected if the reform gives rise to uncertainties about the timing and or amount of benchmark-based cash flows of the hedged item or the hedging instrument. These amendments had no impact on the interim condensed financial statements of the Company as it does not have any interest rate hedge relationships.Amendments to IAS 1 and IAS 8: Definition of MaterialThe amendments provide a new definition of material that states “information is material if omitting, misstating or obscuring it could reasonably be expected to influence decisions that the primary users of general purpose financial statements make on the basis of those financial statements, which provide financial information about a specific reporting entity.” The amendments clarify that materiality will depend on the nature or magnitude of information, either individually or in combination with other information, in the context of the financial statements. A misstatement of information is material if it could reasonably be expected to influence decisions made by the primary users. These amendments had no impact on the interim condensed financial statements of, nor is there expected to be any future impact to the Company.Amendments to IFRS 3: Definition of a businessThe amendment to IFRS 3 clarifies that to be considered a business, an integrated set of activities and assets must include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create output. Furthermore, it clarified that a business can exist without including all of the inputs and processes needed to create outputs. These amendments had no impact on the interim condensed financial statements of the Company but may impact future periods should the Company enter into any business combinations.Conceptual Framework for Financial Reporting issued on March 29, 2018The Conceptual Framework is not a standard, and none of the concepts contained therein override the concepts or requirements in any standard. The purpose of the Conceptual Framework is to assist the IASB in developing standards, to help preparers develop consistent accounting policies where there is no applicable standard in place and to assist all parties to understand and interpret the standards. The revised Conceptual Framework includes some new concepts, provides updated definitions and recognition criteria for assets and liabilities and clarifies some important concepts. These amendments had no impact on the interim condensed financial statements of the Company.Standards issued but not yet effectiveStandards issued but not yet effective up to the date of issuance of the Company’s interim condensed financial statements are listed below. The listing is of standards and interpretations issued, which the Company reasonably expects to be applicable at a future date. The Company intends to adopt these standards when they become effective.Standard/InterpretationDescriptionEffective from periods beginning on or after the following dateIFRS 9Financial Instruments (note below)See note belowIFRS 17Insurance Contracts 1 January 2023IFRS 9 – Financial instrumentsThis standard was published on July 24, 2014 and has replaced IAS 39. The new standard addresses the following items related to financial instruments:a) Classification and measurementIFRS 9 uses a single approach to determine whether a debt financial asset is measured at amortized cost, fair value through other comprehensive income or fair value through profit or loss. A debt financial asset is measured at amortized cost if both:i. the asset is held within a business model whose objective is to hold assets in order to collect contractual cash flows; andii. the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding (“SPPI”).The financial asset is measured at fair value through other comprehensive income and realized gains or losses would be recycled through profit or loss upon sale, if both conditions are met:i. the asset is held within a business model whose objective is to hold assets in order to collect contractual cash flows and for sale; andii. the contractual terms of cash flows are SPPI.Debt financial assets not meeting either of these categories are measured at fair value through profit or loss. Additionally, at initial recognition, an entity can use the option to designate a financial asset, both debt and equity instrument at fair value through profit or loss if doing so eliminates or significantly reduces an accounting mismatch.For equity instruments that are not held for trading, an entity can also make an irrevocable election on initial recognition, to present in other comprehensive income subsequent changes in the fair value of the instruments (including realized gains and losses on disposal), dividends being recognized in statement of income.Additionally, for financial liabilities that are designated as at fair value through profit or loss, the amount of change in the fair value of the financial liability that is attributable to changes in the credit risk of that liability is recognized in other comprehensive income, unless the recognition of the effects of changes in the liability’s credit risk in other comprehensive income would create or enlarge an accounting mismatch in statement of income.b) ImpairmentThe impairment model under IFRS 9 reflects expected credit losses, as opposed to incurred credit losses under IAS 39. Under the IFRS 9 approach, it is no longer necessary for a credit event to have occurred before credit losses are recognized. Instead, an entity always accounts for expected credit losses and changes in those expected credit losses. The amount of expected credit losses is updated at each reporting date to reflect changes in credit risk since initial recognition.c) Hedge accountingIFRS 9 introduces new requirements for hedge accounting that align hedge accounting more closely with Risk Management. The requirements establish a more principles-based approach to the general hedge accounting model. The amendments apply to all hedge accounting with the exception of portfolio fair value hedges of interest rate risk (commonly referred to as “fair value macro hedges”). For these, an entity may continue to apply the hedge accounting requirements currently in IAS 39. This exception was granted largely because the IASB is addressing macro hedge accounting as a separate project.Effective dateThe published effective date of IFRS 9 was January 1, 2018. However, amendments to IFRS 4 – Insurance Contracts: Applying IFRS 9 – Financial Instruments with IFRS 4 – Insurance Contracts, published on September 12, 2016, changes the existing IFRS 4 to allow entities issuing insurance contracts within the scope of IFRS 4 to mitigate certain effects of applying IFRS 9 before the IASB’s new insurance contract standard (IFRS 17 – Insurance Contracts) becomes effective. The amendments introduce two alternative options:1.Apply a temporary exemption from implementing IFRS 9 until the earlier of:a)the effective date of a new insurance contract standard; orb)annual reporting periods beginning on or after January 1, 2021. The IASB is proposing to extend the effective date of IFRS 17 and the IFRS 9 temporary exemption in IFRS 4 to January 1, 2022. Additional disclosures related to financial assets are required during the deferral period. This option is only available to entities whose activities are predominately connected with insurance and have not applied IFRS 9 previously; or2.Adopt IFRS 9 but, for designated financial assets, remove from profit or loss the effects of some of the accounting mismatches that may occur before the new insurance contract standard is implemented. During the interim period, additional disclosures are required.The Company has performed a detailed assessment beginning January 1, 2018: (1) The carrying amount of the Company’s liabilities arising from contracts within the scope of IFRS 4 (including deposit components or embedded derivatives unbundled from insurance contracts) were compared to the total carrying amount of all its liabilities; and (2) the total carrying amount of the Company’s liabilities connected with insurance were compared to the total carrying amount of all its liabilities. Based on these assessments the Company determined that it is eligible for the temporary exemption. Consequently, the Company has decided to defer the implementation of IFRS 9 until the effective date of the new insurance contracts standard. Disclosures related to financial assets required during the deferral period are included in the Company’s annual financial statements.Impact assessmentOverall, the Company expects some impact of applying the impairment requirements of IFRS 9 on the financial statements of the Company. However, the impact of the same is not expected to be significant. At present it is not possible to provide reasonable estimate of the effects of application of this new standard as the Company is yet to perform a detailed review. IFRS 17 – Insurance ContractsOverviewThis standard has been published on May 18, 2017, it establishes the principles for the recognition, measurement, presentation and disclosure of insurance contracts and supersedes IFRS 4 – Insurance contracts.The new standard applies to insurance contracts issued, to all reinsurance contracts and to investment contracts with discretionary participating features provided the entity also issues insurance contracts. It requires to separate the following components from insurance contracts:i.embedded derivatives, if they meet certain specified criteria;ii.distinct investment components; andiii.any promise to transfer distinct goods or non-insurance services.These components should be accounted for separately in accordance with the related standards (IFRS 9 and IFRS 15). MeasurementIn contrast to the requirements in IFRS 4, which permitted insurers to continue to use the accounting policies for measurement purposes that existed prior to January 2015, IFRS 17 provides the following different measurement models:1)The General Measurement Model (GMM) is based on the following “building blocks”:a)the fulfilment cash flows (FCF), which comprises:probability-weighted estimates of future cash flows;an adjustment to reflect the time value of money (i.e. discounting) and the financial risks associated with those future cash flows; and a risk adjustment for non-financial risk.b)the Contractual Service Margin (CSM). The CSM represents the unearned profit for a group of insurance contracts and will be recognized as the entity provides services in the future. The CSM cannot be negative at inception; any net negative amount of the fulfilment cash flows at inception will be recorded in profit or loss immediately. At the end of each subsequent reporting period the carrying amount of a group of insurance contracts is remeasured to be the sum of:the liability for remaining coverage, which comprises the FCF related to future services and the CSM of the group at that date; andthe liability for incurred claims, which is measured as the FCF related to past services allocated to the group at that date.The CSM is adjusted subsequently for changes in cash flows related to future services but the CSM cannot be negative, so changes in future cash flows that are greater than the remaining CSM are recognized in profit or loss. Interest is also accreted on the CSM at rates locked in at initial recognition of a contract (i.e. discount rate used at inception to determine the present value of the estimated cash flows). Moreover, the CSM will be released into profit or loss based on coverage units, reflecting the quantity of the benefits provided and the expected coverage duration of the remaining contracts in the group.2)The Variable Fee Approach (VFA):VFA is a mandatory model for measuring contracts with direct participation features (also referred to as ‘direct participating contracts’). This assessment of whether the contract meets these criteria is made at inception of the contract and not reassessed subsequently. For these contracts, the CSM is also adjusted for in addition to adjustment under general model:i.changes in the entity’s share of the fair value of underlying items;ii.changes in the effect of the time value of money and financial risks not relating to the underlying items.In addition, a simplified Premium Allocation Approach (PAA) is permitted for the measurement of the liability for the remaining coverage if it provides a measurement that is not materially different from the general model or if the coverage period for each contract in the group is one year or less. With the PAA, the liability for remaining coverage corresponds to premiums received at initial recognition less insurance acquisition cash flows. The general model remains applicable for the measurement of incurred claims. However, the entity is not required to adjust future cash flows for the time value of money and the effect of financial risk if those cash flows are expected to be paid/received in one year or less from the date the claims are incurred.Effective dateThe IASB issued an Exposure Draft Amendments to IFRS 17 during June 2019 and received comments from various stakeholders. The IASB is currently re-deliberating issues raised by stakeholders. For any proposed amendments to IFRS 17, the IASB will follow its normal due process for standard-setting. The effective date of IFRS 17 and the deferral of the IFRS 9 temporary exemption in IFRS 4, is currently January 1, 2021. Under the current draft, IFRS 17 effective date is amended to reporting periods beginning on or after January 1, 2023. This is a deferral of 2 years compared to the previous date of January 1, 2021. Earlier application is permitted if both IFRS 15 – Revenue from Contracts with Customers and IFRS 9 – Financial Instruments have also been applied. The Company intend to apply the standard on its effective date.TransitionRetrospective application is required. However, if full retrospective application for a group of insurance contracts is impracticable, then the entity is required to choose either a modified retrospective approach or a fair value approach.Presentation and DisclosuresThe Company expects that the new standard will result in a change to the accounting policies for insurance contracts together with amendments to presentation and disclosures. Impact assessmentThe Company is currently assessing the impact of the application and implementation of IFRS 17. As of the date of the publication of these interim condensed financial statements, the financial impact of adopting the standard is yet to be fully assessed by the Company. The Company has undertaken a Gap Analysis and the key Gaps are as follows: Impact areaSummary of impactFinancial impactNot yet fully assessed by the Company.Data impactThe Company believes that the data impact is not likely to be significant as a major proportion of the Company’s business would qualify for measurement under the premium allocation approach.IT systemsWith respect to IT systems, the Company has short listed a vendor to provide the necessary technical support to ensure an effective implementation of IFRS 17. The current accounting chart of accounts is under review for amendments to comply with IFRS 17 requirements. In addition, new disclosures will need to be developed.Process impactThe process impact is under evaluation, but no significant process changes are anticipated. However, should the Company shift its focus to majority long term business, the process impact would be significant.Impact on reinsurance arrangementsThe Company’s reinsurance arrangements under the proportional treaties currently are under testing to determine the suitable measurement approach.Impact on policies & control’s frameworksThe Company has hired an external consultant to modify their current policies control framework, to be more compliant towards the requirements of IFRS 17.Human resources The Company intends to recruit suitably qualified personnel who have a comprehensive understanding of the IFRS 17. The Company also intends to provide adequate training to existing staff.The Company has started with their implementation process and have set up a proper team, supervised by a steering committee. | 3 |
| Disclosure of summary of significant accounting policies [abstract] | | |
| Disclosure of summary of significant accounting policies, general comment [text block] | The accounting policies used in the preparation of these interim condensed financial statements are consistent with those used in the preparation of the annual financial statements for the year ended December 31, 2019 except as explained below:New IFRS, International Financial Reporting and Interpretations Committee’s interpretations (IFRIC) and amendments thereof, adopted by the CompanyThe following new standards, interpretations, amendments and revisions to existing standards, which were issued by the International Accounting Standards Board (IASB) have been effective from January 1, 2020, as applicable:Amendments to IAS 39 and IFRS 7: Interest Rate Benchmark ReformThe amendments to and IAS 39 ‘Financial Instruments: Recognition and Measurement’ provide a number of reliefs, which apply to all hedging relationships that are directly affected by interest rate benchmark reform. A hedging relationship is affected if the reform gives rise to uncertainties about the timing and or amount of benchmark-based cash flows of the hedged item or the hedging instrument. These amendments had no impact on the interim condensed financial statements of the Company as it does not have any interest rate hedge relationships.Amendments to IAS 1 and IAS 8: Definition of MaterialThe amendments provide a new definition of material that states “information is material if omitting, misstating or obscuring it could reasonably be expected to influence decisions that the primary users of general purpose financial statements make on the basis of those financial statements, which provide financial information about a specific reporting entity.” The amendments clarify that materiality will depend on the nature or magnitude of information, either individually or in combination with other information, in the context of the financial statements. A misstatement of information is material if it could reasonably be expected to influence decisions made by the primary users. These amendments had no impact on the interim condensed financial statements of, nor is there expected to be any future impact to the Company.Amendments to IFRS 3: Definition of a businessThe amendment to IFRS 3 clarifies that to be considered a business, an integrated set of activities and assets must include, at a minimum, an input and a substantive process that together significantly contribute to the ability to create output. Furthermore, it clarified that a business can exist without including all of the inputs and processes needed to create outputs. These amendments had no impact on the interim condensed financial statements of the Company but may impact future periods should the Company enter into any business combinations.Conceptual Framework for Financial Reporting issued on March 29, 2018The Conceptual Framework is not a standard, and none of the concepts contained therein override the concepts or requirements in any standard. The purpose of the Conceptual Framework is to assist the IASB in developing standards, to help preparers develop consistent accounting policies where there is no applicable standard in place and to assist all parties to understand and interpret the standards. The revised Conceptual Framework includes some new concepts, provides updated definitions and recognition criteria for assets and liabilities and clarifies some important concepts. These amendments had no impact on the interim condensed financial statements of the Company.Standards issued but not yet effectiveStandards issued but not yet effective up to the date of issuance of the Company’s interim condensed financial statements are listed below. The listing is of standards and interpretations issued, which the Company reasonably expects to be applicable at a future date. The Company intends to adopt these standards when they become effective.Standard/InterpretationDescriptionEffective from periods beginning on or after the following dateIFRS 9Financial Instruments (note below)See note belowIFRS 17Insurance Contracts 1 January 2023IFRS 9 – Financial instrumentsThis standard was published on July 24, 2014 and has replaced IAS 39. The new standard addresses the following items related to financial instruments:a) Classification and measurementIFRS 9 uses a single approach to determine whether a debt financial asset is measured at amortized cost, fair value through other comprehensive income or fair value through profit or loss. A debt financial asset is measured at amortized cost if both:i. the asset is held within a business model whose objective is to hold assets in order to collect contractual cash flows; andii. the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding (“SPPI”).The financial asset is measured at fair value through other comprehensive income and realized gains or losses would be recycled through profit or loss upon sale, if both conditions are met:i. the asset is held within a business model whose objective is to hold assets in order to collect contractual cash flows and for sale; andii. the contractual terms of cash flows are SPPI.Debt financial assets not meeting either of these categories are measured at fair value through profit or loss. Additionally, at initial recognition, an entity can use the option to designate a financial asset, both debt and equity instrument at fair value through profit or loss if doing so eliminates or significantly reduces an accounting mismatch.For equity instruments that are not held for trading, an entity can also make an irrevocable election on initial recognition, to present in other comprehensive income subsequent changes in the fair value of the instruments (including realized gains and losses on disposal), dividends being recognized in statement of income.Additionally, for financial liabilities that are designated as at fair value through profit or loss, the amount of change in the fair value of the financial liability that is attributable to changes in the credit risk of that liability is recognized in other comprehensive income, unless the recognition of the effects of changes in the liability’s credit risk in other comprehensive income would create or enlarge an accounting mismatch in statement of income.b) ImpairmentThe impairment model under IFRS 9 reflects expected credit losses, as opposed to incurred credit losses under IAS 39. Under the IFRS 9 approach, it is no longer necessary for a credit event to have occurred before credit losses are recognized. Instead, an entity always accounts for expected credit losses and changes in those expected credit losses. The amount of expected credit losses is updated at each reporting date to reflect changes in credit risk since initial recognition.c) Hedge accountingIFRS 9 introduces new requirements for hedge accounting that align hedge accounting more closely with Risk Management. The requirements establish a more principles-based approach to the general hedge accounting model. The amendments apply to all hedge accounting with the exception of portfolio fair value hedges of interest rate risk (commonly referred to as “fair value macro hedges”). For these, an entity may continue to apply the hedge accounting requirements currently in IAS 39. This exception was granted largely because the IASB is addressing macro hedge accounting as a separate project.Effective dateThe published effective date of IFRS 9 was January 1, 2018. However, amendments to IFRS 4 – Insurance Contracts: Applying IFRS 9 – Financial Instruments with IFRS 4 – Insurance Contracts, published on September 12, 2016, changes the existing IFRS 4 to allow entities issuing insurance contracts within the scope of IFRS 4 to mitigate certain effects of applying IFRS 9 before the IASB’s new insurance contract standard (IFRS 17 – Insurance Contracts) becomes effective. The amendments introduce two alternative options:1.Apply a temporary exemption from implementing IFRS 9 until the earlier of:a)the effective date of a new insurance contract standard; orb)annual reporting periods beginning on or after January 1, 2021. The IASB is proposing to extend the effective date of IFRS 17 and the IFRS 9 temporary exemption in IFRS 4 to January 1, 2022. Additional disclosures related to financial assets are required during the deferral period. This option is only available to entities whose activities are predominately connected with insurance and have not applied IFRS 9 previously; or2.Adopt IFRS 9 but, for designated financial assets, remove from profit or loss the effects of some of the accounting mismatches that may occur before the new insurance contract standard is implemented. During the interim period, additional disclosures are required.The Company has performed a detailed assessment beginning January 1, 2018: (1) The carrying amount of the Company’s liabilities arising from contracts within the scope of IFRS 4 (including deposit components or embedded derivatives unbundled from insurance contracts) were compared to the total carrying amount of all its liabilities; and (2) the total carrying amount of the Company’s liabilities connected with insurance were compared to the total carrying amount of all its liabilities. Based on these assessments the Company determined that it is eligible for the temporary exemption. Consequently, the Company has decided to defer the implementation of IFRS 9 until the effective date of the new insurance contracts standard. Disclosures related to financial assets required during the deferral period are included in the Company’s annual financial statements.Impact assessmentOverall, the Company expects some impact of applying the impairment requirements of IFRS 9 on the financial statements of the Company. However, the impact of the same is not expected to be significant. At present it is not possible to provide reasonable estimate of the effects of application of this new standard as the Company is yet to perform a detailed review. IFRS 17 – Insurance ContractsOverviewThis standard has been published on May 18, 2017, it establishes the principles for the recognition, measurement, presentation and disclosure of insurance contracts and supersedes IFRS 4 – Insurance contracts.The new standard applies to insurance contracts issued, to all reinsurance contracts and to investment contracts with discretionary participating features provided the entity also issues insurance contracts. It requires to separate the following components from insurance contracts:i.embedded derivatives, if they meet certain specified criteria;ii.distinct investment components; andiii.any promise to transfer distinct goods or non-insurance services.These components should be accounted for separately in accordance with the related standards (IFRS 9 and IFRS 15). MeasurementIn contrast to the requirements in IFRS 4, which permitted insurers to continue to use the accounting policies for measurement purposes that existed prior to January 2015, IFRS 17 provides the following different measurement models:1)The General Measurement Model (GMM) is based on the following “building blocks”:a)the fulfilment cash flows (FCF), which comprises:probability-weighted estimates of future cash flows;an adjustment to reflect the time value of money (i.e. discounting) and the financial risks associated with those future cash flows; and a risk adjustment for non-financial risk.b)the Contractual Service Margin (CSM). The CSM represents the unearned profit for a group of insurance contracts and will be recognized as the entity provides services in the future. The CSM cannot be negative at inception; any net negative amount of the fulfilment cash flows at inception will be recorded in profit or loss immediately. At the end of each subsequent reporting period the carrying amount of a group of insurance contracts is remeasured to be the sum of:the liability for remaining coverage, which comprises the FCF related to future services and the CSM of the group at that date; andthe liability for incurred claims, which is measured as the FCF related to past services allocated to the group at that date.The CSM is adjusted subsequently for changes in cash flows related to future services but the CSM cannot be negative, so changes in future cash flows that are greater than the remaining CSM are recognized in profit or loss. Interest is also accreted on the CSM at rates locked in at initial recognition of a contract (i.e. discount rate used at inception to determine the present value of the estimated cash flows). Moreover, the CSM will be released into profit or loss based on coverage units, reflecting the quantity of the benefits provided and the expected coverage duration of the remaining contracts in the group.2)The Variable Fee Approach (VFA):VFA is a mandatory model for measuring contracts with direct participation features (also referred to as ‘direct participating contracts’). This assessment of whether the contract meets these criteria is made at inception of the contract and not reassessed subsequently. For these contracts, the CSM is also adjusted for in addition to adjustment under general model:i.changes in the entity’s share of the fair value of underlying items;ii.changes in the effect of the time value of money and financial risks not relating to the underlying items.In addition, a simplified Premium Allocation Approach (PAA) is permitted for the measurement of the liability for the remaining coverage if it provides a measurement that is not materially different from the general model or if the coverage period for each contract in the group is one year or less. With the PAA, the liability for remaining coverage corresponds to premiums received at initial recognition less insurance acquisition cash flows. The general model remains applicable for the measurement of incurred claims. However, the entity is not required to adjust future cash flows for the time value of money and the effect of financial risk if those cash flows are expected to be paid/received in one year or less from the date the claims are incurred.Effective dateThe IASB issued an Exposure Draft Amendments to IFRS 17 during June 2019 and received comments from various stakeholders. The IASB is currently re-deliberating issues raised by stakeholders. For any proposed amendments to IFRS 17, the IASB will follow its normal due process for standard-setting. The effective date of IFRS 17 and the deferral of the IFRS 9 temporary exemption in IFRS 4, is currently January 1, 2021. Under the current draft, IFRS 17 effective date is amended to reporting periods beginning on or after January 1, 2023. This is a deferral of 2 years compared to the previous date of January 1, 2021. Earlier application is permitted if both IFRS 15 – Revenue from Contracts with Customers and IFRS 9 – Financial Instruments have also been applied. The Company intend to apply the standard on its effective date.TransitionRetrospective application is required. However, if full retrospective application for a group of insurance contracts is impracticable, then the entity is required to choose either a modified retrospective approach or a fair value approach.Presentation and DisclosuresThe Company expects that the new standard will result in a change to the accounting policies for insurance contracts together with amendments to presentation and disclosures. Impact assessmentThe Company is currently assessing the impact of the application and implementation of IFRS 17. As of the date of the publication of these interim condensed financial statements, the financial impact of adopting the standard is yet to be fully assessed by the Company. The Company has undertaken a Gap Analysis and the key Gaps are as follows: Impact areaSummary of impactFinancial impactNot yet fully assessed by the Company.Data impactThe Company believes that the data impact is not likely to be significant as a major proportion of the Company’s business would qualify for measurement under the premium allocation approach.IT systemsWith respect to IT systems, the Company has short listed a vendor to provide the necessary technical support to ensure an effective implementation of IFRS 17. The current accounting chart of accounts is under review for amendments to comply with IFRS 17 requirements. In addition, new disclosures will need to be developed.Process impactThe process impact is under evaluation, but no significant process changes are anticipated. However, should the Company shift its focus to majority long term business, the process impact would be significant.Impact on reinsurance arrangementsThe Company’s reinsurance arrangements under the proportional treaties currently are under testing to determine the suitable measurement approach.Impact on policies & control’s frameworksThe Company has hired an external consultant to modify their current policies control framework, to be more compliant towards the requirements of IFRS 17.Human resources The Company intends to recruit suitably qualified personnel who have a comprehensive understanding of the IFRS 17. The Company also intends to provide adequate training to existing staff.The Company has started with their implementation process and have set up a proper team, supervised by a steering committee. | 3 |
| Description of accounting policy for cash and cash equivalents [text block] | Cash and cash equivalentsJune 30, 2020(Unaudited)December 31, 2019(Audited)Cash in hand3228Bank balances251,02332,804Deposits maturing within 3 months from the acquisition date182,551321,875433,606354,707The bank balances and deposits are held with a bank which is a related party, incorporated in Saudi Arabia and are denominated in Saudi Riyals and US Dollars. The bank has a sound credit rating. The deposits have an original maturity of less than three months and yield income at rates up to 1% per annum (December 31, 2019: up to 2% per annum). | 4 |
| Description of accounting policy for zakat [text block] | 11.1 Components of zakat baseSignificant components of zakat base of the Company attributable to the Saudi shareholders, which are subject to adjustment under zakat and income tax regulations, are shareholders’ equity at the beginning of the period, adjusted net income and certain other items. Zakat base has been computed based on the Company’s understanding of the zakat regulations enforced in the Kingdom of Saudi Arabia. The zakat regulations in Saudi Arabia are subject to different interpretations, and the assessments to be raised by the General Authority of Zakat and Tax (“GAZT”) could be different from the declaration filed by the Company. 11.2 Provision for zakat and income taxJune 30, 2020(Unaudited)December 31, 2019 (Audited)Opening 5,853 7,305 Charge for zakat – current period/year2,587 4,161 Charge for zakat – prior period/year 769 -Charge for income tax – current period/year1,118 1,184 Charge for income tax – prior period/year 165 -Payment of zakat (5,324) (4,784)Payment of income tax (1,311) (292)Reduction in income tax recoverable (38) (185)Other charges - 7 Tax paid in advance - (1,543)Closing 3,8195,853Zakat is payable at 2.578% of the approximate zakat base (excluding adjusted net income for the period) and 2.5% of adjusted net income for the period/year attributable to Saudi shareholders.Provision for income tax is payable at 20% of the adjusted net income attributable to the foreign shareholders of the Company, less allowances for foreign shareholders’ share in the losses carry forwarded from previous year calculated in accordance with the guidelines provided in the income tax regulations. Income tax paid is recovered from foreign shareholders.The shareholding percentage subject to zakat and income tax is as follows:June 30, 2020(Unaudited)December 31, 2019 (Audited)%%Zakat74.4474.44Income tax25.5625.5611.3Status of assessments The Company has filed its tax returns with GAZT from inception up to 2019. The Company’s tax and Zakat position has been finalised up to and including the year ended December 31, 2018, except for the assessment for withholding tax as explained below. The tax return for 2013 is deemed to be finalized as no queries has been received from the GAZT and the statutory time limit of 5 years is over. The Company has received the final assessment for 2018 for zakat and income tax, the assessment has raised additional tax and Zakat liability for SR 175 thousand. Management has accepted this assessment and has paid this amount in the current reporting period. During the three-month period ended June 30, 2020, the Company has received the final assessment for the years 2014 to 2017 for zakat and income tax. The assessment has raised additional tax and zakat liability of SR 934 thousand. Management has accepted this assessment and has paid this amount in the current reporting period.In addition to above, the Company has also received an assessment for the 2018 withholding tax liability in which the GAZT has imposed additional taxes, including penalties, of SR 11.37 million. Management believes that the assessment raised is without merit and has appealed against this assessment. The Company’s initial appeal was rejected by the GAZT and has been escalated to the General Secretariat of Tax Committee (GSTC) online portal in order to assign the hearing session by the related Committee to discuss the Company's objection. However, management of the Company believes that there is a high probability that the majority of this assessment will be waived and hence no additional liability has been recorded against this assessment. | 11 |
| Description of accounting policy for fair value measurement [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 advantages accessible market for the asset or liabilityThe fair values of on-balance sheet financial instruments are not significantly different from their carrying amounts included in these interim condensed financial statements.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.As at June 30, 2020 and December 31, 2019, all financial instruments which are fair valued are Level 3 instruments except for investment in sukuks and equity amounting to SR 31.51 million (December 31, 2019: SR 30.03 million) and SR 2.6 million (December 31, 2019: SR 3.02 million) which are Level 1 investments. The Company ascertains the Level 3 fair values based on a valuation technique which is primarily derived by net assets value of the respective investee at the period end. There are no transfers between Level 1, Level 2 and Level 3 during the periods.Available for sale investment is carried at cost as its fair value cannot be measured reliably. | 17 |
| Description of accounting policy for investment income [text block] | Investments NoteJune 30, 2020(Unaudited)December 31,2019(Audited)Fair value through income statement investments (FVIS)8.1110,116110,645Available-for-sale investment8.21,9231,923112,039112,5688.1 Fair value through income statement investments (FVIS)Movement in FVIS is as follows:Six-month period ended June 30, 2020(Unaudited)Year ended December 31, 2019(Audited)Opening balance110,645105,004Additions during the period/year -284Changes in fair value of investments(529)5,357Closing balance 110,116110,6458.2Available-for-sale investmentThis represents the Company’s 3.85% (December 31, 2019: 3.85%) holding in Najm for Insurance Services Company, a Saudi Closed Joint Stock Company. These shares are un-quoted and are carried at cost. In the absence of reliable financial information, management believe that fair values cannot be ascertained reliably. | 8 |
| Description of accounting policy for segment reporting [text block] | Operating segments Operating segments are identified on the basis of internal reports about components of the Company that are regularly reviewed by the Company’s Board of Directors in their function as chief operating decision maker in order to allocate resources to the segments and to assess its performance. Transactions between the operating segments are on normal commercial terms and conditions. The revenue from external parties reported to the Board is measured in a manner consistent with that in the condensed income statement. Segment assets and liabilities comprise operating assets and liabilities.There have been no changes to the basis of segmentation or the measurement basis for the segment profit or loss since December 31, 2019. Segment assets do not include cash and cash equivalents, premiums receivables, investments, due from reinsurers, prepaid expenses and other assets, property and equipment, statutory deposit and accrued income on statutory deposit. Accordingly, they are included in unallocated assets. Segment liabilities do not include policy holders claims payable, accrued and other liabilities, due to reinsurers, agents, brokers and third-party administrators, surplus distribution payable, zakat and income tax, and accrued income on statutory deposit. Accordingly, they are included in unallocated liabilities.These unallocated assets and liabilities are not reported to chief operating decision maker under related segments and are monitored on a centralized basis.The segment information provided to the Company’s Board of Directors for the reportable segments for the Company’s total assets and liabilities at June 30, 2020 and December 31, 2019, its total revenues, expenses, and net income for the three-month and six-month periods ended June 30, 2020 and June 30, 2019, are as follows:MarinePropertyMotorEngineeringAccident & liabilityExtended warrantyTerm lifeTotal Three-monthperiod ended June 30,2020 (unaudited)RevenuesGross premiums written7,08914,946120,39636411,5375,26220,100179,694Reinsurance premiumsceded (5,609)(13,257)(3,006)87(10,156)(5,262)(9,307)(46,510)Excess of loss expenses(1,480)(775)(3,775)(300)(90)--(6,420)Net premiums written-914113,6151511,291-10,793126,764Change in unearnedpremiums, net2,8561,005(26,380)330894-(5,113)(26,408)Net premiums earned2,8561,91987,2354812,185-5,680100,356Reinsurance commissions 3,3524,8473491,9761,93060264813,704Other underwriting income203-24-130Total revenues6,2286,76987,5842,4594,1196026,329114,090Cost and expensesGross claims paid and loss adjustment expenses, net of recoveries3,9652,21731,2161,3021,10795315,42356,183Reinsurer’s share of claims paid(3,264)(2,051)(789)(1,118)(552)(953)(12,511)(21,238)Net claims paid70116630,427184555-2,91234,945Changes in outstanding claims, net(405)1,7095,244(53)(291)-(747)5,457Changes in claims incurred but not reported, net(63)1281,581(129)(146)-5231,894Net claims incurred2332,00337,2522118-2,68842,296Premium deficiency reserve--5,147----5,147Additional unexpired risk reserve---20---20Unallocated loss adjustment expense provision(7)19217 (5)(19)-(44) 161Policy acquisition costs2,3552,7695,9538091,1994352,04515,565Total underwriting cost and expenses2,5814,79148,5698261,2984354,68963,189Net underwriting income 3,6471,97839,0151,6332,8211671,64050,901Other operating income /(expenses)Impairment allowance for doubtful premium, reinsurers and other receivables(8,961)General and administration expenses(31,994)Commission income on deposits783Unrealized gain on investments984Other income2,465Total other operating expenses, net(36,723)Net income for the period Total income attributed to policyholdersNet income for the period attributable to the shareholders, before zakat and income tax14,178(1,476)__________ 12,702Zakat(2,156)Income tax(1,245)Net income for the period9,301MarinePropertyMotorEngineeringAccident & liabilityExtended warrantyTerm lifeTotal Six-month period ended June 30,2020 (unaudited)RevenuesGross premiums written24,63480,248255,34035,64030,05512,37944,166482,462Reinsurance premiumsceded (18,831)(72,693)(6,374)(33,702)(23,548)(12,379)(29,198)(196,725)Excess of loss expenses(2,869)(1,450)(5,125)(600)(180)--(10,224)Net premiums written2,9346,105243,8411,3386,327-14,968275,513Change in unearned premiums, net1,709(2,300)(61,686)(124)(1,843)-(6,567)(70,811)Net premiums earned4,6433,805182,1551,2144,484-8,401204,702Reinsurance commissions 6,5649,0647246,5613,3331,0973,64430,987Other underwriting income4013-617-581Total revenues11,24712,882182,8797,7817,8341,09712,050235,770Cost and expensesGross claims paid and loss adjustment expenses, net of recoveries6,2513,96499,9821,9574,5432,54024,084143,321Reinsurer’s share of claims paid(4,848)(3,680)(2,828)(1,690)(3,669)(2,540)(19,921)(39,176)Net claims paid1,40328497,154267874-4,163104,145Changes in outstanding claims, net(306)1,7209,09221(331)-24510,441Changes in claims incurred but not reported, net(157)1421,512(223)14-6391,927Net claims incurred9402,146107,75865557-5,047116,513Premium deficiency reserve--5,223----5,223Additional unexpired risk reserve---(262)---(262)Unallocated loss adjustment expense provision10253226(5)(12)-(71)293Policy acquisition costs3,9635,13912,6573,5932,1077913,95532,205Total underwriting cost and expenses5,0057,338125,8643,3912,6527918,931153,972Net underwriting income 6,2425,54457,0154,3905,1823063,11981,798Other operating income / (expenses)Impairment allowance for doubtful premium, reinsurers and other receivables(10,852)General and administration expenses(67,984)Commission income on deposits1,838Unrealized loss on investments(529)Other income2,884Total other operating expenses, net(74,643)Net income for the period7,155Total income attributed to the policy holders(1,153)Net income for the period attributable to the shareholders, before zakat and income tax__________6,002Zakat(3,356)Income tax(1,245)Net income for the period1,401MarinePropertyMotorEngineeringAccident & liabilityExtended warrantyTerm lifeTotal Three-monthperiod ended June 30,2019 (unaudited) RevenuesGross premiums written8,96415,753141,0254,5336,0365,85625,781207,948Reinsurance premiumsceded (6,678)(14,038)(3,507)(4,036)(4,669)(5,856)(22,001)(60,785)Excess of loss expenses(299)(601)(1,250)(250)(75)--(2,475)Net premiums written1,9871,114136,2682471,292-3,780144,688Change in unearned premiums, net1,7241,150(41,557)209512-(902)(38,864)Net premiums earned3,7112,26494,7114561,804-2,878105,824Reinsurance commissions 2,9125,0648592,1721,4003,0724,85720,336Other underwriting income195826-242Total revenues6,6427,33395,5782,6303,2103,0727,737126,202Cost and expensesGross claims paid and loss adjustment expenses, net of recoveries1,7642,57571,5664,2502181,8148,34890,535Reinsurer’s share of claims paid(1,373)(2,257)(4,366)(3,868)(159)(1,814)(6,874) (20,711)Net claims paid39131867,20038259-1,47469,824Changes in outstanding claims, net8531,15314,864(435)760-16817,363Changes in claims incurred but not reported claims, net--12,432----12,432Net claims incurred1,2441,47194,496(53)819-1,64299,619Premium deficiency reserve--(4,807)----(4,807)Unallocated loss adjustment expense provision--2,576----2,576Policy acquisition costs1,7262,4505,4801,1377002,5442,67316,710Total underwriting cost and expenses2,9703,92197,7451,0841,5192,5444,315114,098Net underwriting income/(loss) 3,6723,412(2,167)1,5461,6915283,42212,104Other operating (expenses) / incomeImpairment allowance for doubtful premium, reinsurers and other receivables(10,437)General and administration expenses(26,524)Commission income on deposits1,638Unrealized gain on investments1,069Other income7,127Total other operating expenses, net(27,127)Net loss for the period attributable to the shareholders before zakat and income tax__________(15,023)Zakat(1,132)Income tax 152 Net loss for the period(16,003)MarinePropertyMotorEngineeringAccident & liabilityExtended warrantyTerm lifeTotal Six-monthperiod ended June 30,2019 (unaudited) RevenuesGross premiums written23,49873,863274,91126,24221,79010,28048,267478,851Reinsurance premiumsceded (17,168)(65,709)(6,902)(24,446)(15,312)(10,280)(41,833)(181,650)Excess of loss expenses(689)(2,060)(2,925)(500)(150)-(119)(6,443)Net premiums written5,6416,094265,0841,2966,328-6,315290,758Change in unearned premiums, net198(2,630)(77,564)(370)(2,438)-(2,145)(84,949)Net premiums earned5,8393,464187,5209263,890-4,170205,809Reinsurance commissions 5,0169,8031,9804,2652,7576,3469,48239,649Other underwriting income43651002020-5253Total revenues10,89813,332189,6005,2116,6676,34613,657245,711Cost and expensesGross claims paid and loss adjustment expenses, net of recoveries4,6624,560151,3149,1219852,65220,526193,820Reinsurer’s share of claims paid(3,652)(3,809)(10,181)(8,528)(794)(2,652)(16,741)(46,357)Net claims paid1,010751141,133593191-3,785147,463Changes in outstanding claims, net1,1961,76414,603(1,091)737-(377)16,832Changes in claims incurred but not reported, net3912215,940(262)(254)-(437)15,148Net claims incurred2,2452,637171,676(760)674-2,971179,443Premium deficiency reserve(15)2,327(13,579)353---(10,914)Additional unexpired risk reserve---14--- 14Unallocated loss adjustment expense provision(142)922,660(111)(33)-(87)2,379Policy acquisition costs2,9254,74611,1092,2021,4375,2694,94432,632Total underwriting cost and expenses5,0139,802171,8661,6982,0785,2697,828203,554Net underwriting income 5,8853,53017,7343,5134,5891,0775,82942,157Other operating (expenses) / incomeImpairment allowance for doubtful premium, reinsurers and other receivables(17,302)General and administration expenses(51,917)Commission income on deposits3,353Unrealized gain on investments2,657Other income13,952Total other operating Income / (loss)(49,257)Net loss for the period attributable to the shareholders, before zakat and income tax(7,100)Zakat(2,614)Income tax(590)Net loss for the period(10,304) MarinePropertyMotorEngineeringAccident & LiabilityExtended warrantyTerm Life TotalAs at June 30, 2020(Unaudited)AssetsReinsurers’ share of unearned premiums8,22250,1175,25023,18619,19432,09913,358151,426Reinsurers’ share of outstanding claims6,92021,2813,204381,650106,243305,761525,089Reinsurers’ share of claims incurred but not reported5,7893,3612,11023,21910,352-11,55156,382Deferred policy acquisition costs5245,36312,7222,6281,8658,1082,655 33,865Unallocated assets866,106Total assets1,632,868LiabilitiesUnearned premiums9,72155,366209,95724,88723,83232,09921,318377,180Unearned reinsurance commission1,3739,6977885,0643,14511,2001,18732,454Outstanding claims10,00424,25880,105385,323107,684306,948614,352Claims incurred but not reported6,3483,74742,54523,58712,728-14,442103,397Premium deficiency reserve--16,068---16,068Additional unexpired risk reserve---137---137Unallocated loss adjustment expense provision2261883,884209442-358 5,307 Unallocated liabilities224,690Total liabilities 1,373,585MarinePropertyMotorEngineeringAccident & LiabilityExtended WarrantyTerm Life TotalAs at December 31, 2019 (Audited)AssetsReinsurers’ share of unearned premiums14,29425,4763,67020,13111,46622,9057,002104,944Reinsurers’ share of outstanding claims9,5169,5283,311390,830111,073377,306531,601Reinsurers’ share of claims incurred but not reported3,8542,0681,72925,59911,784-12,05757,091Deferred policy acquisition costs2,1073,0397,8782,8091,2155,6781,04523,771Unallocated assets 848,284Total assets1,565,691LiabilitiesUnearned premiums17,50328,425146,69121,70814,26122,9058,394259,887Unearned reinsurance commission3,5104,8235514,7211,8867,8451,99225,328Outstanding claims12,90610,78671,119394,481112,845378,249610,423Claims incurred but not reported4,5682,31340,65126,19114,146-14,310102,179Premium deficiency reserve--10,845----10,845Additional unexpired risk reserve---399---399Unallocated loss adjustment expense provision2191543,577208487-3695,014Unallocated liabilities293,346Total liabilities 1,307,421 | 18 |
| Description of accounting policy for statutory deposit [text block] | In compliance with Article 58 of the Implementing Regulations of the Saudi Arabian Monetary Authority ("SAMA"), the Company has deposited 10% of its share capital, amounting to Saudi Riyals 20 million in a bank designated by SAMA. The statutory deposit is maintained with a reputed bank which is also a related party. The Company cannot withdraw this deposit without SAMA’s approval. Commission accruing on this deposit is payable to SAMA.In accordance with instructions received from SAMA vide their circular dated March 1, 2016; the Company has disclosed the commission due on the statutory deposit as an asset and a liability in these interim condensed financial statements. | 10 |
| Disclosure of notes forming part of accounts [abstract] | | |
| Disclosure of investments [text block] | Investments NoteJune 30, 2020(Unaudited)December 31,2019(Audited)Fair value through income statement investments (FVIS)8.1110,116110,645Available-for-sale investment8.21,9231,923112,039112,5688.1 Fair value through income statement investments (FVIS)Movement in FVIS is as follows:Six-month period ended June 30, 2020(Unaudited)Year ended December 31, 2019(Audited)Opening balance110,645105,004Additions during the period/year -284Changes in fair value of investments(529)5,357Closing balance 110,116110,6458.2Available-for-sale investmentThis represents the Company’s 3.85% (December 31, 2019: 3.85%) holding in Najm for Insurance Services Company, a Saudi Closed Joint Stock Company. These shares are un-quoted and are carried at cost. In the absence of reliable financial information, management believe that fair values cannot be ascertained reliably. | 8 |
| Disclosure of investments at fair value through statement of income [text block] | 8.1 Fair value through income statement investments (FVIS)Movement in FVIS is as follows:Six-month period ended June 30, 2020(Unaudited)Year ended December 31, 2019(Audited)Opening balance110,645105,004Additions during the period/year -284Changes in fair value of investments(529)5,357Closing balance 110,116110,645 | 8.1 |
| Disclosure of due from related parties [text block] | 19Related parties balances and transactions 19.1Related parties transactions Related parties represent major shareholders, directors and key management personnel of the Company, and entities controlled or significantly influenced by such parties.The Company in the normal course of business carries out transactions with its related parties. The transactions are made on the agreed terms and are approved by the Board of Directors.The significant transactions with related parties and the related amounts are as follows:Three-month period ended June 30, 2020(Unaudited)Three-month period ended June 30, 2019 (Unaudited)Six-month period ended June 30, 2020 (Unaudited)Six-month period ended June 30, 2019 (Unaudited)Related PartyNature of TransactionsBoard MembersFees and related expenses2364301,2651,405Key management personnelShareholders’ and related parties (common ownership)Remuneration and related expenses2,7482,7375,5805,582-Loans & advances250402250402-Insurance premiums written6,32412,43421,00736,117-Claims paid2,0703,4114,9036,910-Facultative premiums ceded6198571,7252,298-Facultative Commission received53153297476-Facultative claim recovered-93208957-Expenses incurred1,4891,2672,8202,586-Commission income on deposits7831,6381,8383,35319.2Related parties balances June 30,2020(Unaudited)December 31, 2019(Audited)Premiums receivable, net12,0638,913Claims payable3,1635,809Cash and cash equivalents with a shareholder 433,574354,679Amounts due (to)/from a shareholder for facultative transactions (545)39Advances due from key management personnel 250602Amount due to a related party for expenses2,894-Income tax receivable from foreign shareholders 3591,184Statutory deposit with a shareholder 20,00020,000Directors fees payable60-Accrued income on statutory deposit1,3891,275 | 19 |
| Disclosure of cash and cash equivalents [text block] | Cash and cash equivalentsJune 30, 2020(Unaudited)December 31, 2019(Audited)Cash in hand3228Bank balances251,02332,804Deposits maturing within 3 months from the acquisition date182,551321,875433,606354,707The bank balances and deposits are held with a bank which is a related party, incorporated in Saudi Arabia and are denominated in Saudi Riyals and US Dollars. The bank has a sound credit rating. The deposits have an original maturity of less than three months and yield income at rates up to 1% per annum (December 31, 2019: up to 2% per annum). | 4 |
| Disclosure of statutory deposit [text block] | In compliance with Article 58 of the Implementing Regulations of the Saudi Arabian Monetary Authority ("SAMA"), the Company has deposited 10% of its share capital, amounting to Saudi Riyals 20 million in a bank designated by SAMA. The statutory deposit is maintained with a reputed bank which is also a related party. The Company cannot withdraw this deposit without SAMA’s approval. Commission accruing on this deposit is payable to SAMA.In accordance with instructions received from SAMA vide their circular dated March 1, 2016; the Company has disclosed the commission due on the statutory deposit as an asset and a liability in these interim condensed financial statements. | 10 |
| Disclosure of due to related parties [text block] | 19Related parties balances and transactions 19.1Related parties transactions Related parties represent major shareholders, directors and key management personnel of the Company, and entities controlled or significantly influenced by such parties.The Company in the normal course of business carries out transactions with its related parties. The transactions are made on the agreed terms and are approved by the Board of Directors.The significant transactions with related parties and the related amounts are as follows:Three-month period ended June 30, 2020(Unaudited)Three-month period ended June 30, 2019 (Unaudited)Six-month period ended June 30, 2020 (Unaudited)Six-month period ended June 30, 2019 (Unaudited)Related PartyNature of TransactionsBoard MembersFees and related expenses2364301,2651,405Key management personnelShareholders’ and related parties (common ownership)Remuneration and related expenses2,7482,7375,5805,582-Loans & advances250402250402-Insurance premiums written6,32412,43421,00736,117-Claims paid2,0703,4114,9036,910-Facultative premiums ceded6198571,7252,298-Facultative Commission received53153297476-Facultative claim recovered-93208957-Expenses incurred1,4891,2672,8202,586-Commission income on deposits7831,6381,8383,35319.2Related parties balances June 30,2020(Unaudited)December 31, 2019(Audited)Premiums receivable, net12,0638,913Claims payable3,1635,809Cash and cash equivalents with a shareholder 433,574354,679Amounts due (to)/from a shareholder for facultative transactions (545)39Advances due from key management personnel 250602Amount due to a related party for expenses2,894-Income tax receivable from foreign shareholders 3591,184Statutory deposit with a shareholder 20,00020,000Directors fees payable60-Accrued income on statutory deposit1,3891,275 | 19 |
| Disclosure of zakat [text block] | 11.1 Components of zakat baseSignificant components of zakat base of the Company attributable to the Saudi shareholders, which are subject to adjustment under zakat and income tax regulations, are shareholders’ equity at the beginning of the period, adjusted net income and certain other items. Zakat base has been computed based on the Company’s understanding of the zakat regulations enforced in the Kingdom of Saudi Arabia. The zakat regulations in Saudi Arabia are subject to different interpretations, and the assessments to be raised by the General Authority of Zakat and Tax (“GAZT”) could be different from the declaration filed by the Company. 11.2 Provision for zakat and income taxJune 30, 2020(Unaudited)December 31, 2019 (Audited)Opening 5,853 7,305 Charge for zakat – current period/year2,587 4,161 Charge for zakat – prior period/year 769 -Charge for income tax – current period/year1,118 1,184 Charge for income tax – prior period/year 165 -Payment of zakat (5,324) (4,784)Payment of income tax (1,311) (292)Reduction in income tax recoverable (38) (185)Other charges - 7 Tax paid in advance - (1,543)Closing 3,8195,853Zakat is payable at 2.578% of the approximate zakat base (excluding adjusted net income for the period) and 2.5% of adjusted net income for the period/year attributable to Saudi shareholders.Provision for income tax is payable at 20% of the adjusted net income attributable to the foreign shareholders of the Company, less allowances for foreign shareholders’ share in the losses carry forwarded from previous year calculated in accordance with the guidelines provided in the income tax regulations. Income tax paid is recovered from foreign shareholders.The shareholding percentage subject to zakat and income tax is as follows:June 30, 2020(Unaudited)December 31, 2019 (Audited)%%Zakat74.4474.44Income tax25.5625.5611.3Status of assessments The Company has filed its tax returns with GAZT from inception up to 2019. The Company’s tax and Zakat position has been finalised up to and including the year ended December 31, 2018, except for the assessment for withholding tax as explained below. The tax return for 2013 is deemed to be finalized as no queries has been received from the GAZT and the statutory time limit of 5 years is over. The Company has received the final assessment for 2018 for zakat and income tax, the assessment has raised additional tax and Zakat liability for SR 175 thousand. Management has accepted this assessment and has paid this amount in the current reporting period. During the three-month period ended June 30, 2020, the Company has received the final assessment for the years 2014 to 2017 for zakat and income tax. The assessment has raised additional tax and zakat liability of SR 934 thousand. Management has accepted this assessment and has paid this amount in the current reporting period.In addition to above, the Company has also received an assessment for the 2018 withholding tax liability in which the GAZT has imposed additional taxes, including penalties, of SR 11.37 million. Management believes that the assessment raised is without merit and has appealed against this assessment. The Company’s initial appeal was rejected by the GAZT and has been escalated to the General Secretariat of Tax Committee (GSTC) online portal in order to assign the hearing session by the related Committee to discuss the Company's objection. However, management of the Company believes that there is a high probability that the majority of this assessment will be waived and hence no additional liability has been recorded against this assessment. | 11 |
| Disclosure of income tax [text block] | 11.1 Components of zakat baseSignificant components of zakat base of the Company attributable to the Saudi shareholders, which are subject to adjustment under zakat and income tax regulations, are shareholders’ equity at the beginning of the period, adjusted net income and certain other items. Zakat base has been computed based on the Company’s understanding of the zakat regulations enforced in the Kingdom of Saudi Arabia. The zakat regulations in Saudi Arabia are subject to different interpretations, and the assessments to be raised by the General Authority of Zakat and Tax (“GAZT”) could be different from the declaration filed by the Company. 11.2 Provision for zakat and income taxJune 30, 2020(Unaudited)December 31, 2019 (Audited)Opening 5,853 7,305 Charge for zakat – current period/year2,587 4,161 Charge for zakat – prior period/year 769 -Charge for income tax – current period/year1,118 1,184 Charge for income tax – prior period/year 165 -Payment of zakat (5,324) (4,784)Payment of income tax (1,311) (292)Reduction in income tax recoverable (38) (185)Other charges - 7 Tax paid in advance - (1,543)Closing 3,8195,853Zakat is payable at 2.578% of the approximate zakat base (excluding adjusted net income for the period) and 2.5% of adjusted net income for the period/year attributable to Saudi shareholders.Provision for income tax is payable at 20% of the adjusted net income attributable to the foreign shareholders of the Company, less allowances for foreign shareholders’ share in the losses carry forwarded from previous year calculated in accordance with the guidelines provided in the income tax regulations. Income tax paid is recovered from foreign shareholders.The shareholding percentage subject to zakat and income tax is as follows:June 30, 2020(Unaudited)December 31, 2019 (Audited)%%Zakat74.4474.44Income tax25.5625.5611.3Status of assessments The Company has filed its tax returns with GAZT from inception up to 2019. The Company’s tax and Zakat position has been finalised up to and including the year ended December 31, 2018, except for the assessment for withholding tax as explained below. The tax return for 2013 is deemed to be finalized as no queries has been received from the GAZT and the statutory time limit of 5 years is over. The Company has received the final assessment for 2018 for zakat and income tax, the assessment has raised additional tax and Zakat liability for SR 175 thousand. Management has accepted this assessment and has paid this amount in the current reporting period. During the three-month period ended June 30, 2020, the Company has received the final assessment for the years 2014 to 2017 for zakat and income tax. The assessment has raised additional tax and zakat liability of SR 934 thousand. Management has accepted this assessment and has paid this amount in the current reporting period.In addition to above, the Company has also received an assessment for the 2018 withholding tax liability in which the GAZT has imposed additional taxes, including penalties, of SR 11.37 million. Management believes that the assessment raised is without merit and has appealed against this assessment. The Company’s initial appeal was rejected by the GAZT and has been escalated to the General Secretariat of Tax Committee (GSTC) online portal in order to assign the hearing session by the related Committee to discuss the Company's objection. However, management of the Company believes that there is a high probability that the majority of this assessment will be waived and hence no additional liability has been recorded against this assessment. | 11 |
| Disclosure of statutory reserve [text block] | In compliance with the Insurance Implementing Regulations issued by SAMA, 20% of the income for the year after adjusting accumulated losses shall be set aside from net income as a statutory reserve until this amounts to 100% of the paid-up share capital. The required amount would be transferred at the year end. | 13 |
| Disclosure of technical reserve for insurance/takaful/reinsurance/retakaful operations [text block] | Technical reserves7.1 Net outstanding claims and reserves Net outstanding claims and reserves comprise of the following:June 30,2020 (Unaudited) December 31,2019(Audited)Outstanding claims614,352610,423Claims incurred but not reported103,397102,179Premium deficiency reserve16,068 10,845Additional unexpired risk reserve137399Unallocated loss adjustment expense provision5,3075,014739,261728,860Less:Reinsurers’ share of outstanding claims(525,089)(531,601)Reinsurers’ share of claims incurred but not reported(56,382)(57,091)(581,471) (588,692)Net outstanding claims and reserves157,790 140,1687.2 Movement in unearned premiumsMovement in unearned premiums comprise of the following:Six-month period ended June 30, 2020(Unaudited)GrossReinsuranceNetBalance at the beginning of the period259,887104,944154,943Premium written during the period482,462206,949275,513Premium earned during the period(365,169)(160,467)(204,702)Balance at the end of the period377,180151,426225,754Year ended December 31, 2019(Audited)GrossReinsuranceNetBalance at the beginning of the year 253,354104,039149,315Premium written during the year735,044 319,338 415,706Premium earned during the year (728,511) (318,433)(410,078)Balance at the end of the year 259,887104,944 154,943 | 7 |
| Disclosure of compensation to key management personnel [text block] | 19Related parties balances and transactions 19.1Related parties transactions Related parties represent major shareholders, directors and key management personnel of the Company, and entities controlled or significantly influenced by such parties.The Company in the normal course of business carries out transactions with its related parties. The transactions are made on the agreed terms and are approved by the Board of Directors.The significant transactions with related parties and the related amounts are as follows:Three-month period ended June 30, 2020(Unaudited)Three-month period ended June 30, 2019 (Unaudited)Six-month period ended June 30, 2020 (Unaudited)Six-month period ended June 30, 2019 (Unaudited)Related PartyNature of TransactionsBoard MembersFees and related expenses2364301,2651,405Key management personnelShareholders’ and related parties (common ownership)Remuneration and related expenses2,7482,7375,5805,582-Loans & advances250402250402-Insurance premiums written6,32412,43421,00736,117-Claims paid2,0703,4114,9036,910-Facultative premiums ceded6198571,7252,298-Facultative Commission received53153297476-Facultative claim recovered-93208957-Expenses incurred1,4891,2672,8202,586-Commission income on deposits7831,6381,8383,35319.2Related parties balances June 30,2020(Unaudited)December 31, 2019(Audited)Premiums receivable, net12,0638,913Claims payable3,1635,809Cash and cash equivalents with a shareholder 433,574354,679Amounts due (to)/from a shareholder for facultative transactions (545)39Advances due from key management personnel 250602Amount due to a related party for expenses2,894-Income tax receivable from foreign shareholders 3591,184Statutory deposit with a shareholder 20,00020,000Directors fees payable60-Accrued income on statutory deposit1,3891,275 | 19 |
| Disclosure of earnings per share [text block] | The authorized, issued and paid up capital of the Company is SAR 200 million divided into 20 million shares of SR 10 each (December 31, 2019: SAR 200 million divided into 20 million shares of SR 10 each).Earnings per share for the three-month and six-month periods ended June 30, 2020 have been calculated by dividing the net income for the respective period attributable to the shareholders by the weighted average number of ordinary shares at the reporting date. Diluted earnings per share is not applicable to the Company. | 12 |
| Disclosure of investments held at fair value through statement of income [text block] | This represents the Company’s 3.85% (December 31, 2019: 3.85%) holding in Najm for Insurance Services Company, a Saudi Closed Joint Stock Company. These shares are un-quoted and are carried at cost. In the absence of reliable financial information, management believe that fair values cannot be ascertained reliably. | 8.2 |
| Disclosure of related party transactions [text block] | 19Related parties balances and transactions 19.1Related parties transactions Related parties represent major shareholders, directors and key management personnel of the Company, and entities controlled or significantly influenced by such parties.The Company in the normal course of business carries out transactions with its related parties. The transactions are made on the agreed terms and are approved by the Board of Directors.The significant transactions with related parties and the related amounts are as follows:Three-month period ended June 30, 2020(Unaudited)Three-month period ended June 30, 2019 (Unaudited)Six-month period ended June 30, 2020 (Unaudited)Six-month period ended June 30, 2019 (Unaudited)Related PartyNature of TransactionsBoard MembersFees and related expenses2364301,2651,405Key management personnelShareholders’ and related parties (common ownership)Remuneration and related expenses2,7482,7375,5805,582-Loans & advances250402250402-Insurance premiums written6,32412,43421,00736,117-Claims paid2,0703,4114,9036,910-Facultative premiums ceded6198571,7252,298-Facultative Commission received53153297476-Facultative claim recovered-93208957-Expenses incurred1,4891,2672,8202,586-Commission income on deposits7831,6381,8383,35319.2Related parties balances June 30,2020(Unaudited)December 31, 2019(Audited)Premiums receivable, net12,0638,913Claims payable3,1635,809Cash and cash equivalents with a shareholder 433,574354,679Amounts due (to)/from a shareholder for facultative transactions (545)39Advances due from key management personnel 250602Amount due to a related party for expenses2,894-Income tax receivable from foreign shareholders 3591,184Statutory deposit with a shareholder 20,00020,000Directors fees payable60-Accrued income on statutory deposit1,3891,275 | 19 |
| Disclosure of entity's operating segments [text block] | Operating segments Operating segments are identified on the basis of internal reports about components of the Company that are regularly reviewed by the Company’s Board of Directors in their function as chief operating decision maker in order to allocate resources to the segments and to assess its performance. Transactions between the operating segments are on normal commercial terms and conditions. The revenue from external parties reported to the Board is measured in a manner consistent with that in the condensed income statement. Segment assets and liabilities comprise operating assets and liabilities.There have been no changes to the basis of segmentation or the measurement basis for the segment profit or loss since December 31, 2019. Segment assets do not include cash and cash equivalents, premiums receivables, investments, due from reinsurers, prepaid expenses and other assets, property and equipment, statutory deposit and accrued income on statutory deposit. Accordingly, they are included in unallocated assets. Segment liabilities do not include policy holders claims payable, accrued and other liabilities, due to reinsurers, agents, brokers and third-party administrators, surplus distribution payable, zakat and income tax, and accrued income on statutory deposit. Accordingly, they are included in unallocated liabilities.These unallocated assets and liabilities are not reported to chief operating decision maker under related segments and are monitored on a centralized basis.The segment information provided to the Company’s Board of Directors for the reportable segments for the Company’s total assets and liabilities at June 30, 2020 and December 31, 2019, its total revenues, expenses, and net income for the three-month and six-month periods ended June 30, 2020 and June 30, 2019, are as follows:MarinePropertyMotorEngineeringAccident & liabilityExtended warrantyTerm lifeTotal Three-monthperiod ended June 30,2020 (unaudited)RevenuesGross premiums written7,08914,946120,39636411,5375,26220,100179,694Reinsurance premiumsceded (5,609)(13,257)(3,006)87(10,156)(5,262)(9,307)(46,510)Excess of loss expenses(1,480)(775)(3,775)(300)(90)--(6,420)Net premiums written-914113,6151511,291-10,793126,764Change in unearnedpremiums, net2,8561,005(26,380)330894-(5,113)(26,408)Net premiums earned2,8561,91987,2354812,185-5,680100,356Reinsurance commissions 3,3524,8473491,9761,93060264813,704Other underwriting income203-24-130Total revenues6,2286,76987,5842,4594,1196026,329114,090Cost and expensesGross claims paid and loss adjustment expenses, net of recoveries3,9652,21731,2161,3021,10795315,42356,183Reinsurer’s share of claims paid(3,264)(2,051)(789)(1,118)(552)(953)(12,511)(21,238)Net claims paid70116630,427184555-2,91234,945Changes in outstanding claims, net(405)1,7095,244(53)(291)-(747)5,457Changes in claims incurred but not reported, net(63)1281,581(129)(146)-5231,894Net claims incurred2332,00337,2522118-2,68842,296Premium deficiency reserve--5,147----5,147Additional unexpired risk reserve---20---20Unallocated loss adjustment expense provision(7)19217 (5)(19)-(44) 161Policy acquisition costs2,3552,7695,9538091,1994352,04515,565Total underwriting cost and expenses2,5814,79148,5698261,2984354,68963,189Net underwriting income 3,6471,97839,0151,6332,8211671,64050,901Other operating income /(expenses)Impairment allowance for doubtful premium, reinsurers and other receivables(8,961)General and administration expenses(31,994)Commission income on deposits783Unrealized gain on investments984Other income2,465Total other operating expenses, net(36,723)Net income for the period Total income attributed to policyholdersNet income for the period attributable to the shareholders, before zakat and income tax14,178(1,476)__________ 12,702Zakat(2,156)Income tax(1,245)Net income for the period9,301MarinePropertyMotorEngineeringAccident & liabilityExtended warrantyTerm lifeTotal Six-month period ended June 30,2020 (unaudited)RevenuesGross premiums written24,63480,248255,34035,64030,05512,37944,166482,462Reinsurance premiumsceded (18,831)(72,693)(6,374)(33,702)(23,548)(12,379)(29,198)(196,725)Excess of loss expenses(2,869)(1,450)(5,125)(600)(180)--(10,224)Net premiums written2,9346,105243,8411,3386,327-14,968275,513Change in unearned premiums, net1,709(2,300)(61,686)(124)(1,843)-(6,567)(70,811)Net premiums earned4,6433,805182,1551,2144,484-8,401204,702Reinsurance commissions 6,5649,0647246,5613,3331,0973,64430,987Other underwriting income4013-617-581Total revenues11,24712,882182,8797,7817,8341,09712,050235,770Cost and expensesGross claims paid and loss adjustment expenses, net of recoveries6,2513,96499,9821,9574,5432,54024,084143,321Reinsurer’s share of claims paid(4,848)(3,680)(2,828)(1,690)(3,669)(2,540)(19,921)(39,176)Net claims paid1,40328497,154267874-4,163104,145Changes in outstanding claims, net(306)1,7209,09221(331)-24510,441Changes in claims incurred but not reported, net(157)1421,512(223)14-6391,927Net claims incurred9402,146107,75865557-5,047116,513Premium deficiency reserve--5,223----5,223Additional unexpired risk reserve---(262)---(262)Unallocated loss adjustment expense provision10253226(5)(12)-(71)293Policy acquisition costs3,9635,13912,6573,5932,1077913,95532,205Total underwriting cost and expenses5,0057,338125,8643,3912,6527918,931153,972Net underwriting income 6,2425,54457,0154,3905,1823063,11981,798Other operating income / (expenses)Impairment allowance for doubtful premium, reinsurers and other receivables(10,852)General and administration expenses(67,984)Commission income on deposits1,838Unrealized loss on investments(529)Other income2,884Total other operating expenses, net(74,643)Net income for the period7,155Total income attributed to the policy holders(1,153)Net income for the period attributable to the shareholders, before zakat and income tax__________6,002Zakat(3,356)Income tax(1,245)Net income for the period1,401MarinePropertyMotorEngineeringAccident & liabilityExtended warrantyTerm lifeTotal Three-monthperiod ended June 30,2019 (unaudited) RevenuesGross premiums written8,96415,753141,0254,5336,0365,85625,781207,948Reinsurance premiumsceded (6,678)(14,038)(3,507)(4,036)(4,669)(5,856)(22,001)(60,785)Excess of loss expenses(299)(601)(1,250)(250)(75)--(2,475)Net premiums written1,9871,114136,2682471,292-3,780144,688Change in unearned premiums, net1,7241,150(41,557)209512-(902)(38,864)Net premiums earned3,7112,26494,7114561,804-2,878105,824Reinsurance commissions 2,9125,0648592,1721,4003,0724,85720,336Other underwriting income195826-242Total revenues6,6427,33395,5782,6303,2103,0727,737126,202Cost and expensesGross claims paid and loss adjustment expenses, net of recoveries1,7642,57571,5664,2502181,8148,34890,535Reinsurer’s share of claims paid(1,373)(2,257)(4,366)(3,868)(159)(1,814)(6,874) (20,711)Net claims paid39131867,20038259-1,47469,824Changes in outstanding claims, net8531,15314,864(435)760-16817,363Changes in claims incurred but not reported claims, net--12,432----12,432Net claims incurred1,2441,47194,496(53)819-1,64299,619Premium deficiency reserve--(4,807)----(4,807)Unallocated loss adjustment expense provision--2,576----2,576Policy acquisition costs1,7262,4505,4801,1377002,5442,67316,710Total underwriting cost and expenses2,9703,92197,7451,0841,5192,5444,315114,098Net underwriting income/(loss) 3,6723,412(2,167)1,5461,6915283,42212,104Other operating (expenses) / incomeImpairment allowance for doubtful premium, reinsurers and other receivables(10,437)General and administration expenses(26,524)Commission income on deposits1,638Unrealized gain on investments1,069Other income7,127Total other operating expenses, net(27,127)Net loss for the period attributable to the shareholders before zakat and income tax__________(15,023)Zakat(1,132)Income tax 152 Net loss for the period(16,003)MarinePropertyMotorEngineeringAccident & liabilityExtended warrantyTerm lifeTotal Six-monthperiod ended June 30,2019 (unaudited) RevenuesGross premiums written23,49873,863274,91126,24221,79010,28048,267478,851Reinsurance premiumsceded (17,168)(65,709)(6,902)(24,446)(15,312)(10,280)(41,833)(181,650)Excess of loss expenses(689)(2,060)(2,925)(500)(150)-(119)(6,443)Net premiums written5,6416,094265,0841,2966,328-6,315290,758Change in unearned premiums, net198(2,630)(77,564)(370)(2,438)-(2,145)(84,949)Net premiums earned5,8393,464187,5209263,890-4,170205,809Reinsurance commissions 5,0169,8031,9804,2652,7576,3469,48239,649Other underwriting income43651002020-5253Total revenues10,89813,332189,6005,2116,6676,34613,657245,711Cost and expensesGross claims paid and loss adjustment expenses, net of recoveries4,6624,560151,3149,1219852,65220,526193,820Reinsurer’s share of claims paid(3,652)(3,809)(10,181)(8,528)(794)(2,652)(16,741)(46,357)Net claims paid1,010751141,133593191-3,785147,463Changes in outstanding claims, net1,1961,76414,603(1,091)737-(377)16,832Changes in claims incurred but not reported, net3912215,940(262)(254)-(437)15,148Net claims incurred2,2452,637171,676(760)674-2,971179,443Premium deficiency reserve(15)2,327(13,579)353---(10,914)Additional unexpired risk reserve---14--- 14Unallocated loss adjustment expense provision(142)922,660(111)(33)-(87)2,379Policy acquisition costs2,9254,74611,1092,2021,4375,2694,94432,632Total underwriting cost and expenses5,0139,802171,8661,6982,0785,2697,828203,554Net underwriting income 5,8853,53017,7343,5134,5891,0775,82942,157Other operating (expenses) / incomeImpairment allowance for doubtful premium, reinsurers and other receivables(17,302)General and administration expenses(51,917)Commission income on deposits3,353Unrealized gain on investments2,657Other income13,952Total other operating Income / (loss)(49,257)Net loss for the period attributable to the shareholders, before zakat and income tax(7,100)Zakat(2,614)Income tax(590)Net loss for the period(10,304) MarinePropertyMotorEngineeringAccident & LiabilityExtended warrantyTerm Life TotalAs at June 30, 2020(Unaudited)AssetsReinsurers’ share of unearned premiums8,22250,1175,25023,18619,19432,09913,358151,426Reinsurers’ share of outstanding claims6,92021,2813,204381,650106,243305,761525,089Reinsurers’ share of claims incurred but not reported5,7893,3612,11023,21910,352-11,55156,382Deferred policy acquisition costs5245,36312,7222,6281,8658,1082,655 33,865Unallocated assets866,106Total assets1,632,868LiabilitiesUnearned premiums9,72155,366209,95724,88723,83232,09921,318377,180Unearned reinsurance commission1,3739,6977885,0643,14511,2001,18732,454Outstanding claims10,00424,25880,105385,323107,684306,948614,352Claims incurred but not reported6,3483,74742,54523,58712,728-14,442103,397Premium deficiency reserve--16,068---16,068Additional unexpired risk reserve---137---137Unallocated loss adjustment expense provision2261883,884209442-358 5,307 Unallocated liabilities224,690Total liabilities 1,373,585MarinePropertyMotorEngineeringAccident & LiabilityExtended WarrantyTerm Life TotalAs at December 31, 2019 (Audited)AssetsReinsurers’ share of unearned premiums14,29425,4763,67020,13111,46622,9057,002104,944Reinsurers’ share of outstanding claims9,5169,5283,311390,830111,073377,306531,601Reinsurers’ share of claims incurred but not reported3,8542,0681,72925,59911,784-12,05757,091Deferred policy acquisition costs2,1073,0397,8782,8091,2155,6781,04523,771Unallocated assets 848,284Total assets1,565,691LiabilitiesUnearned premiums17,50328,425146,69121,70814,26122,9058,394259,887Unearned reinsurance commission3,5104,8235514,7211,8867,8451,99225,328Outstanding claims12,90610,78671,119394,481112,845378,249610,423Claims incurred but not reported4,5682,31340,65126,19114,146-14,310102,179Premium deficiency reserve--10,845----10,845Additional unexpired risk reserve---399---399Unallocated loss adjustment expense provision2191543,577208487-3695,014Unallocated liabilities293,346Total liabilities 1,307,421 | 18 |
| Disclosure of capital management [text block] | Objectives are set by the Company to maintain healthy capital ratios in order to support its business objectives and maximize shareholders’ value.The Company manages its capital requirements by assessing shortfalls between reported and required capital levels on a regular basis. Adjustments to current capital levels are made in light of changes in market conditions and risk characteristics of the Company’s activities. In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to shareholders or issue shares.In the opinion of the Board of Directors, the Company has fully complied with the externally imposed capital requirements during the reported financial period. Management, through various scenario analysis as required by the Board of Directors, has proactively assessed the potential of the COVID-19 by performing stress testing for various variables like: gross premium growth, increase in employee cost, YTD loss ratio, outstanding premium provisions etc. and the related impact on the revenue, profitability, loss ratio and solvency ratio for the year ending December 31, 2020. Management has concluded that based on the stress testing performed the solvency of the Company would not be adversely affected. As with any forecasts, the projections and likelihoods of occurrence are underpinned by significant judgement and uncertainty and therefore, the actual outcomes may be different to those projected. The impact of such uncertain economic environment is judgmental, and the Company will continue to reassess its position and the related impact on a regular basis. | 20 |
| Disclosure of commitments and contingencies, general [text block] | The Company’s bankers have issued guarantee of SR 1.4 million (December 31, 2019: SR 2.1 million) to its suppliers on behalf of the Company. Also see note 11.3. | 14 |
| Disclosure of board of director's approval of the financial statements [text block] | These interim condensed financial statements have been approved by the Board of Directors on August 10, 2020 corresponding to Dhul Hijjah 20, 1441 H. | 23 |
