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Editorial Advisory Board

  • Professor Andrea M. Armani, University of Southern California
  • Ruti Ben-Shlomi, Ph.D., LightSolver
  • James Butler, Ph.D., Hamamatsu
  • Natalie Fardian-Melamed, Ph.D., Columbia University
  • Justin Sigley, Ph.D., AmeriCOM
  • Professor Birgit Stiller, Max Planck Institute for the Science of Light, and Leibniz University of Hannover
  • Professor Stephen Sweeney, University of Glasgow
  • Mohan Wang, Ph.D., University of Oxford
  • Professor Xuchen Wang, Harbin Engineering University
  • Professor Stefan Witte, Delft University of Technology

AM Best Affirms Credit Ratings of Al Dhafra Insurance Company P.S.C.

AM Best has affirmed the Financial Strength Rating of B++ (Good) and the Long-Term Issuer Credit Rating of “bbb+” (Good) of Al Dhafra Insurance Company P.S.C. (ADIC) (United Arab Emirates) [UAE]. The outlook of these Credit Ratings (ratings) is stable.

The ratings reflect ADIC’s balance sheet strength, which AM Best assesses as very strong, as well as its strong operating performance, limited business profile and appropriate enterprise risk management.

ADIC’s balance sheet strength assessment is underpinned by its risk-adjusted capitalisation at the strongest level, as measured by Best’s Capital Adequacy Ratio (BCAR), a history of good internal capital generation and strong liquidity. Offsetting factors in the balance sheet strength assessment include ADIC’s investment concentration toward domestic equities and its high reinsurance dependence with a retention ratio below 30% over the last few years. The credit risk associated with this dependence is mitigated partially by the use of a well-diversified reinsurance panel of sound financial strength.

ADIC has a track record of strong operating performance, demonstrated by a five-year (2020-2024) weighted average return on equity of 8.9%, as calculated by AM Best. However underwriting performance has been challenged since 2023, with the company reporting a net-net combined ratio, as calculated by AM Best, of 101.4% for the year-ended 31 December 2024. The decline was primarily driven by an increase in expenses, losses due to major rain events in 2024, and large losses in the marine hull portfolio. Following corrective actions taken by management, ADIC’s technical performance has started to return to pre-2023 averages during the first two quarters of 2025. Underwriting results are supported by modest, albeit stable investment returns.

ADIC’s business profile is considered to be supportive of a limited assessment. The company is a mid-tier insurer in the UAE, with insurance revenue of AED 346.3 million (USD 94.3 million) for the year-ended 31 December 2024. The company’s underwriting portfolio is concentrated geographically in the highly competitive UAE market. While ADIC benefits from a diversified underwriting portfolio by line of business on a gross basis, its retained portfolio has concentration in the motor and medical lines of business.

This press release relates to Credit Ratings that have been published on AM Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see AM Best’s Recent Rating Activity web page. For additional information regarding the use and limitations of Credit Rating opinions, please view Guide to Best’s Credit Ratings. For information on the proper use of Best’s Credit Ratings, Best’s Performance Assessments, Best’s Preliminary Credit Assessments and AM Best press releases, please view Guide to Proper Use of Best’s Ratings & Assessments.

AM Best is a global credit rating agency, news publisher and data analytics provider specialising in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.

Copyright © 2025 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.

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