Al Rajhi Takaful says entire ARIG case amount reserved, risks pre-assessed

Logo of Al-Rajhi Company for Cooperative Insurance (Al Rajhi Takaful) 

Al-Rajhi Company for Cooperative Insurance (Al Rajhi Takaful) issued an explanatory statement today, March 28, on the lawsuit filed by Arab Insurance Group (ARIG) over a dispute on insurance premiums, indicating the final judgment was issued in 2024 directing to pay SAR 25.44 million to ARIG, including chartered account fees. 

The company confirmed that financial reserves covered the lawsuit amount, with pre-assessed risks, considering the matter is a non-material event.

Al Rajhi Takaful detailed taking the necessary precautions since the lawsuit’s start, including securing 100% of the claim's value in financial reserves.

Of this, SAR 15.81 million, mainly for insurance premiums, was agreed to be paid by Al Rajhi Takaful before the lawsuit. The actual dispute over cancelled documents, initially SAR 16.42 million, was reduced to SAR 9.63 million following the decision. Furthermore, a leading law firm provided legal advice on the litigation.

The company clarified that a dispute over insurance premium amounts started in 2015 between the parties due to non-receipt of premiums from the insured related to the extended warranty insurance on insured policies, which ARIG reinsuranced.

ARIG filed a lawsuit against Al Rajhi Takaful with the Committees for Resolution of Insurance Disputes & Violations over a disagreement on the owed amount. Al Rajhi Takaful recognized a claim of only SAR 158.1 million, while ARIG demanded SAR 33.26 million for unpaid premiums.