Bahrain Kuwait Insurance Company (BKIC) reported a net profit of BD627,000 ($1.65 million) for the first quarter of this year, compared to BD1.9 million ($5 million) for the same period last year.

Announcing the results chairman Murad Ali Murad said last year profits included BD1.5 million being non-recurring and one time gain on sale of investment property, reported the Gulf Daily News, our sister publication.

Technical profits for the first were BD352,000 as compared to BD570,000 for the corresponding period last year.

The reduction in technical profits was due to several factors. The most important was the increase in loss ratio in fire and general accident department.

Apart from this, there were additional expenses towards hit and run cases for motor accidents and the decline in exchange rate of Kuwaiti dinar against Bahraini dinar. The net investment income was BD591,000 for the first quarter of this year compared to BD1.6 million in the same period last year, which included an extra ordinary income of BD1.5 million on account of gain on sale of investment property.

Chief executive Ebrahim Al Rayes said that in spite of the decrease in technical profits, the results are satisfactory given the present situation of severe competition in the region and lack of new projects.

"Premium rates are under pressure due to the competition with no increase in new business. There is also delay in releasing the budget for 2015-2016 by the government which is also one of the reasons for delay in commencement of new projects,” said Al Rayes.

"Gross premium in Bahraini dinar decreased by 2.4 per cent mainly due to weakening of the Kuwaiti currency.

"We hope that the performance will improve in the coming periods,” he added. – TradeArabia News Service