The Business Year

Bader Khalid Al Anzi


2017 USD9.87 billion market expansion

CEO, Solidarity Takaful


Khalid Al Anzi was the acting CEO of Solidarity from 2015 and was appointed CEO in September 2016. He has vast experience in the insurance industry and holds a master degree from the US.
He is a member of the Insurance Executive Committee (IEC), which operates as a mediator between the market and Saudi Arabian Monetary Authority (SAMA).

“The model that we use is that everyone contributes to our takaful pool, though at the end the company takes 5% for management fees.“

How would you characterize Solidarity Takaful’s position in the market?

Our vision has always been to offer the best takaful products that comply with sharia principles, all while serving customers in a way they have not been served before. This was not an easy journey, and while the SAMA works to help takaful companies, we had to come up with a hybrid model to satisfy the customer and regulator. We came up with a unique model since our company was established, and it has to do with distributing the surplus for our customers, if we have one. Some companies now seek to follow that same model that we created.

How do you distribute the surplus to your customer base, and how is it different from what was done previously?

Our company’s role is only to take a percentage of what customers paid in order to provide our service, rather than using the entire premium. The model that we use is that everyone contributes to our takaful pool, though at the end the company takes 5% for management fees and a 10% performance incentive for our employees. The remainder goes back to policyholders as long as there is a surplus in our portfolio. No one else has this unique model, and we are extremely pleased with how it is working. Our customers are also pleased by how much they get back from their overall annual contribution. Sometimes they use it to renew their policy, and sometimes they simply take the cash.

How have adjustments in the framework by SAMA impacted your operations?

It is working on organizing the competition and avoiding the bad practices that occurred in the market before. It is also working to be fair with both companies and customers at the same time. In prior years, customers did not know their rights. One challenge SAMA is working on is aligning the insurance market with Vision 2030. New products are needed in the market, and we see that with international companies that seek to enter the Saudi market and want to have the right insurance plans while they are here. We received news about a few special products that will be introduced in the market. Through our coordination, we came up with new products that will be extremely helpful for newcomers in the market.

What products have been growing in demand in recent years?

We have 67 products in total. We work to have a great mix in our portfolio, avoiding concentrating on just a few. Some companies do not do this; however, it is key to our success. The market is open, as is competition. We need to use this opportunity to build a balanced portfolio, without depending on anything specific. We have life, marine, engineering, medical, and motor, for example, and some of them are compulsory, while others are commercial.

Do you provide packages to your customers?

We do have packages, though they are limited. Therefore, we are trying to offer too many packages that could be complicated. We prefer to let our customers select what is most useful for them. We always try to offer whatever they may need and keep their business within our company, though the competition is challenging. People are now more aware of insurance than they were before. They previously believed it was unacceptable and not compliant with sharia. However, they now better understand what it is and the benefits insurance can bring. They also know there are specifically sharia-compliant products on the market now and they can contribute and still get the same benefits. The industry has flipped 180 degrees. 2017 saw the market expand to nearly SAR37 billion (USD9.87 billion), and growth is ongoing. There are still some challenges, especially during this transformation period; however, I hope growth will continue. It all depends on how people understand the market.

What is the current level of understanding of life insurance specifically?

Life insurance is still a huge challenge in Saudi Arabia, and we are working hard to convince our customers about how important it is. Lately, the government has also come out in support of the idea of life insurance, and pensions become more popular. It will not be compulsory, though the government will encourage people to contribute to such products that can help them retire or pay out a bulk amount to a beneficiary. Most people believe that it is against sharia to have life insurance, and our mission is thus to promote products that are in line with their beliefs. Then, we will educate and explain how they work and how people can reap the benefits of such products. I expect a major shift in the life segment in Saudi Arabia in the coming years.

What synergies do you strive for with your sister companies in Bahrain and Jordan?

We have Solidarity Group Holding, which owns 27.5% of our stocks. It also owns majority percentage in Jordan and the same in Bahrain. There has been a great deal of coordination between the three affiliates recently. We have unified our logo and one will be able to see the same branding in all three locations, which will make customers more comfortable when it comes to using or planning their insurance in all three countries. When it comes to experience, Bahrain is the most well versed in the market, as its company was established long before ours. We are working to learn as much as we can from its products and performance. We are currently studying our options for expansion, and there may be more news coming soon.

What are your ambitions and expectations for the coming years?

The local market has more insurance companies than needed, and many companies are working to merge to create stronger and larger entities that can compete. Solidarity is also looking for a M&A opportunity; we have not made any decisions yet, though we expect such a move to increase our market share and create a stronger company. There are currently 30 companies in the market; however, 15 would be enough for this market. SAMA will likely not issue any new licenses at this time. It may later issue licenses for foreign companies, though it may want to minimize the number of companies operating currently.



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