Bahrain Kuwait Insurance Company (BKIC) has posted a net profit of BD3.7 million ($9.7 million) for the period ending on September 30 this year, an increase of 30 per cent over BD2.8 million achieved in the same period last year.

BKIC chairman Murad Ali Murad said the net profit for the third quarter amounted to BD1.1 million as compared to BD828,000 for the same period last year, said a report in the Gulf Daily News (GDN), our sister publication.

He said that despite the slight decline in underwriting profit by 1.4 per cent - from BD2.6 million at the end of the third quarter last year to BD2.56 million at he end of the third quarter of this year, the three months ended on September 30 showed a remarkable improvement due to progress in the loss ratio, after a drop in the second quarter attributable to the increase in motor claims.

Murad said the investment income at the end of the third quarter registered an impressive growth of 98 per cent, reaching BD2 million, which includes the extraordinary profits of BD1.5m from the sale of real estate property located in Diplomatic Area during the first quarter of this year, compared with BD1 million in the same period of 2013.

Shareholders' equity increased by seven per cent from BD33.3 million at the end of third quarter of 2013 to BD35.7 million at the end of the third quarter of this year. Return on shareholders' equity increased to 10.36 per cent at the end of third quarter of this year compared to 8.88 per cent for the same period in 2013.

Earnings per share has reached 52 fils at the end of third quarter of this year compared to 40 fils in the same period in 2013. Technical reserves increased from BD13.5 million at the end of 2013 to BD13.8 million at the end of the third quarter of this year.

Chief executive Ebrahim Al Rayes said gross premiums registered a growth of nine per cent from BD25.8 million at the end of third quarter in 2013 to BD28.2 million at the end of third quarter of this year. He said BKIC is still the market leader in terms of gross premiums.

Al Rayes said one of the main challenges that the company facing at present is the fierce competition between the insurance companies in both Bahrain and Kuwait markets alike, especially in the motor and medical insurance, which put more pressure on prices that consequently affect the profits of these companies.

He said the company was recently granted 'A-' credit rating by AM Best, which is the best credit rating in the local market.

BKIC is a member of Gulf Insurance Group owned by Kuwait Projects Company and FairFax International. - TradeArabia News Service