1. Insurers' Solvency Valuation
MENA - The Inevitable Trend Towards Risk Based Solvency
BEIRUT, LEBANON
19 SEPTEMBER 2018
Presented by:
Rita Antonios
Senior Underwriter (Medical)/Actuary
Arab Re - Lebanon

2. Contents Solvency II Benefits MENA Solvency II Challenges
Capacity Assessment Exercise
4. MENA Implementation and Position from Risk Based Solvency Approach
Arab Reinsurance Company

3. Why Solvency II?
Arab Reinsurance Company

4. Market Consistent Valuation of Assets and Liabilities
1. Solvency II Benefits
Solvency II Launches
Market Consistent Valuation of Assets and Liabilities
Enhanced Quality of Capital
Risk-Based Capital Requirements
Improved Governance and Risk-Management
Strengthened Market Discipline
Arab Reinsurance Company

5. What Are The Challenges Faced?
Arab Reinsurance Company

6. MENA Solvency II Barriers High Level of Competition
2. MENA Solvency II Challenges
MENA Solvency II Barriers
High Level of Competition
Political Instability
Operational Challenges
Increasing Reinsurance Prices
Low Credit Environment
Arab Reinsurance Company

7. 3. Capacity Assessment
In order to meet its obligations, insurance companies must remain financially solid.
Arab Reinsurance Company

8. How much risk does the insurer wants to be exposed to?
3. Capacity Assessment
(USD $billion)
Rank
Company Name
Country
Premium Written 2016
Premium Written 2015
Shareholders Equity 2016
Shareholders Equity 2015 01
TAWUNIYA
KSA
2.15
2.01
0.78
0.62 02
BUPA ARABIA
2.12
1.95
0.54
0.44 03
QATAR INSURANCE
QATAR
1.72
1.51
2.31
2.20 04
DAMAN NATIONAL HEALTH
UAE
1.43
1.2
N/A 05
MEDGULF GROUP
BAHRAIN
1.15
1.3
How much risk does the insurer wants to be exposed to?
Economic Profit  18% - 40% Return on Equity
Growth  2% - 7% of Total Volume
Solvency Margin  >115% of Solvency Capital Requirement
Arab Reinsurance Company

9. 4. MENA Implementation and Position from Risk Based Solvency Approach
“The issuance of such Financial Regulations puts the UAE at the forefront of the Middle East with regard to adopting the latest solvency requirements similar to the European model”
H. E. Eng. Sultan bin Saeed Al Mansouri, UAE Minister of Economy and Chairman of the Insurance Authority
“The ICC also completed two major projects with WorldBank experts covering the framework for the motor third party liability insurance and the risk-based capital model”
Mrs. Nadine El Habbal, the Acting Head of the Insurance Control Commission in Lebanon
“I think increasing the minimum paid-up capital will give more incentives to those branches to contribute more to our local market and develop their business.”
Mr Ahmed Al Mamari, Acting Director General, Directorate of Insurance Supervision with the Capital Market Authority (CMA) in Oman
“The insurance industry is moving towards final adoption of the framework by 2021”
Mr Bachir Baddou, director general of the FMSAR in Morocco
Arab Reinsurance Company

10. Thank You!
Arab Reinsurance Company