MILLI RE 2020 ANNUAL REPORT

Financial Status Risks and Assessment of the Governing Body Unconsolidated Financial Statements Together with Independent Auditors’ Report Thereon Consolidated Financial Statements Together with Independent Auditors’ Report Thereon 59 Milli Re Annual Report 2020 On the regulatory side, the most important development was the merger of Insurance Authority (IA) and the Central Bank of UAE which was announced by the UAE Cabinet transferring all Powers of IA to the Central Bank including legislation of new regulations, licensing, supervision and policyholder protection. The top three markets of 2020 in terms of gross written premium are Saudi Arabia, UAE and Qatar. In Saudi Arabia, the listed insurers posted a 3.5% increase in premium production, which reached USD 7.8 billion at the end of the 3 rd quarter. UAE, the second largest insurance market in the Region, managed to post a 3.9% increase in gross premiums to USD 5.2 billion, despite 14 out of 29 companies reporting reduction in their written premiums. Qatar recorded a growth around 5%, in line with the total uptick of the Region by 4.4%, which equates USD 3.3 billion. Across the GCC, Kuwait is the only market to register a double‑digit annual growth rate in gross written premium, which was up by 17.5%, reaching USD 1.55 billion. Meanwhile, the insurance companies in the GCC displayed an impressive performance in the first nine months of 2020 despite the economic challenges presented by the ongoing Covid‑19 pandemic. The overall profitability of the market improved by 15.7% to USD 1.1 billion in the 3 rd quarter of 2020, while the Region’s premium grew by 4.6% to USD 19 billion. The improved overall profitability for the market was contributed by the 30 Saudi listed insurers, which all posted strong underwriting results. UAE market kept its position of being the second largest in terms of profitability after Saudi Arabia while Kuwait managed to surpass Qatar ranking the third. The long‑term outlook remains positive for both life and Non‑Life insurance in the Region due to significant untapped potential. The widespread working‑age population across the Region is expected to push the demand up partially for savings and retirement products for life insurance while the Non‑Life insurance segment is anticipated to benefit from regulatory support through the expansion of compulsory medical and liability coverage. The insurance companies in the GCC displayed an impressive performance in the first nine months of 2020 despite the economic challenges presented by the ongoing Covid‑19 pandemic and the overall profitability of the market improved by 15.7% in the 3 rd quarter of 2020. USD 1.4 billion In January, hailstorms in south eastern Australia caused insured losses of USD 1.4 billion.