Mohammad Al Suliman, CEO, Najm • Interview
For the Saudi insurance sector, 2020 continued the upward trend of previous years, and for Najm a majority of its operations went digital.
How did you react to the COVID-19 pandemic as an organization, and what impact did it have on your strategy?
As an organization, we adopted a swift and proactive COVID-19 response. Intuitively, we prioritized the safety of employees and customers and replaced the bulk of person-to-person interaction with full automation. We also instructed our surveyors to abide by all safety precautions during on-site operations. During the lockdowns we shut down our 40 branches and migrated 95% of our services to our digital platforms, Najm App and Najm Website, which witnessed a total of around 425k downloads between January and September 2020 and processed over 2.2 million transactions during the same period. Additionally, our 24/7 call center receives over 3 million calls a year. Concurrently, our digitalized operations resulted in higher efficiency in service delivery. This was visible through accident reporting, which was 25% faster through the Najm App than the traditional call center. Najm cooperated with the Saudi Authority for Accredited Valuers (TAQEEM) to activate electronic damage assessment on-site for minor accidents. Najm also supported the government’s COVID-19 response, along with 27 other insurance companies, through collectively donating SAR67.7 million. The insurance companies also enforced automatic twomonth extensions for 4.8 million policies to support the community as part of an initiative carried out in cooperation with other stakeholders. Besides safety, it was necessary to consider sustainability and quality of operations. Thankfully, we successfully balanced these elements as we pursued our office and field operations along with fulfilling our mission of being the hub of digitalization in the Saudi insurance sector. This has been a breakthrough that endorsed our strategy and helped us assert our position at the core of the Saudi insurance sector.
What have you seen in terms of growth of the industry during the pandemic?
From a global perspective, the insurance sector has been among the few industries that have suffered the least impact from the pandemic and is expected to make a quick recovery. Global insurance premiums are forecast to grow anywhere between 3 and 5.6% in 2021, with emerging markets in Asia anticipating a 7% growth in life and non-life premiums. For the Saudi insurance sector, 2020 continued the upward trend of the previous years. General sales between January and September 2020 reached SAR30 billion, with profits of SAR 1.3 billion, compared to around SAR 600 million for the same period of 2019. This is mainly owing to improved operational efficiency and sector restructuring and has resulted in raising the sector’s contribution to non-oil GDP to 2.18% this year, from 2% in 2019. During the beginning of 2020, motor insurance income was weighed down by the disruption of field operations; however, as lockdown measures eased down, the sector’s indicators soon recuperated beyond pre-COVID-19 levels. Motor insurance premiums grew by 8.7% over the first three quarters of the year.
What changes in the industry will likely persist beyond the pandemic?
While the most obvious post-pandemic transformation is the augmented role of digitalization, there are also other areas of the Saudi insurance industry, with all its segments, that this pandemic has tapped into, like the importance of updating business models and the need to restructure insurance costs. Insurance companies’ collective capital currently stands at SAR12.5 billion. The goal is to raise the sector’s collective capital in order to mitigate the private sector’s risk at this critical stage. Achieving this goal may involve strategic insurance company mergers paired with product diversification, especially in the health and motor segments.
BIO
Mohammad Al Suliman was appointed CEO of Najm in 2019 after holding leadership positions in various sectors. Prior to joining Najm, he served as VP of corporate development at the Saudi Telecom Company (STC). Earlier, he was COO at the Saudi Kuwaiti Finance House and VP of Klever Marketing in the US. He obtained his bachelor’s degree in information systems from King Fahd University of Petroleum and Minerals (KFUPM), a master’s in the same field, and a PhD in strategic management and information technology from Claremont Graduate University in the US.