S&P lowers Tawuniya rating to BBB+, outlook negative

S&P Global Ratings on Tuesday lowered its long-term issuer credit and insurer financial strength ratings on Saudi-based insurer The Company for Cooperative Insurance (Tawuniya) to ‘BBB+’ from 'A-'.

The outlook remains negative, it said, warning the rating may be lowered by one or more notches if there is any further material deterioration in the insurer’s operating performance and capital adequacy.

However, the rating agency said that it expects premium income for 2019-2021 to grow at a moderate 5 percent, reflecting management's corrective action to revise prices upward in the medical and other lines, coupled with some initiatives announced by the Saudi government.

“We expect Tawuniya to return to profits from 2019 onwards,” it said.