Liva Group SAOG (LIVA) Earnings Call Transcript & Summary

I hope you can all see my screen and hear us clearly. I'd like to just run you through the agenda for today's session. As it is up on the screen, we'll begin with some introductions on Liva representatives, then followed by the H1 2025 highlights, the H1 2025 financial performance, our portfolio mix, the market highlights, investment income and the strategic outlook. Finally, we'll end the session with a Q&A, which will give our participants a chance to answer some questions, if you have any. I'd like to read you the disclaimer for today's session. The material in this presentation has been prepared by Liva Group SAOG, also known as Liva, and is general background information about Liva's activities current as of the date of this presentation. This information is given in summary form and does not propose to be complete. Information in this presentation, including forecast financial information, if any, should not be considered as advice or a recommendation to investors or potential investors in relation to holding, purchasing or selling securities or other financial products or instruments and does not take into account your particular investment objectives, financial situation or needs. Before acting on any information, you should consider the appropriateness of the information having regard to these matters, any relevant offer documents and in particular, you should seek independent financial advice. This presentation may contain forward-looking statements, including statements regarding our intent, belief or current expectations with respect to Liva's businesses and operations, market conditions, results of operation and financial condition, capital adequacy, specific provisions and risk management practices. Readers are cautioned not to place undue reliance on these forward-looking statements. Liva does not undertake any obligation to publicly release the results of any revisions to these forward-looking statements to reflect events or circumstances after the date hereof and to reflect the occurrence of unanticipated events. While due care has been used in the preparation of forecast information, actual results may vary in a materially positive or negative manner. Forecasts and hypothetical examples are subject to uncertainty and contingencies outside Liva's control. Past performance is not a reliable indication of future performance. I'd like to introduce everyone on this call to the representatives of Liva Group today who will be presenting to you. We have myself, Sara Faraj, the Group Legal Director, who will be moderating today's call. And I'd also like to introduce you to Mr. Martin Rueegg, our Group CEO; and the honorable Dr. Dhafir Al Shanfari, our Group COO. On the line, we also have Ms. Hanaa Al Hinai, the CEO for Liva Insurance Oman; Mr. Mohamed Al Tooblani, the acting CEO of Liva Insurance KSA; Mr. Addal Sarwar, the Group Chief Personal Lines Officer; Mr. Guido Zagatti, the Group Chief Commercial Lines and Reinsurance Officer; and Ms. Eugenie Molyneux, Group Chief Risk Officer. With that, I'd like to hand over now to our Group CEO, Mr. Martin Rueegg, who will commence the presentation.

Thank you very much, Sara, and good afternoon, ladies and gentlemen. It's really a great pleasure to join you today and to share with you the progress Liva Group has achieved in the first half of 2025. Maybe Sara, if you can guide us to the first slide because what you can see on this slide is a set of numbers that are really telling in my mind, a very compelling story of transformation and resilience. In the first half of 2025, the insurance revenues reached an amount of OMR 194 million, which is a new high, which reflects a growth of 24% year-on-year. To put this in context, the overall insurance revenues across the GCC is around 9%. So again, Liva outperformed and double paced almost the market growth across some of the key markets. And as we go further, we will share some of the highlights where it happened and how did it happen. As a result, our market share has increased. Alongside some of the key players in the region, we are now really gaining more and more market share in the core markets, but in the GCC overall, which is something which we set out as part of our strategy. Our insurance service result, which is the technical profit basically from the insurance operation, that means we take all the earnings, deduct claims and other costs related to insurance, is also significantly improving to OMR 10.3 million, really underpinned by pricing discipline, strong reinsurance structures, but also favorable development of older claims, which we managed proactively to close and move forward. The investment side of things, we also achieved a new record of OMR 7.5 million, which is 9% higher than the same period last year. This came despite the volatility we see in the market and was delivered through portfolio optimization and rebalancing. Again, we'll share a bit more details as we go through the presentation. The bottom line, in particular, is really important to us. The profit after tax stood at OMR 8.8 million, a remarkable turnaround compared to a loss of OMR 15.9 million in the same period last year. This is on the back of a sharpened risk selection, but also stronger governance on claim and disciplined cost management. So we really focus on all the core technical elements to make sure that this improvement is sustainable and carries forward. Now when we look at the profitability, what we can see when we compare ourselves with the market that we outperformed the market in most of the jurisdictions and as a group compared to others. This really signals a strong rebound from the 2024 weather event, which shows, as I mentioned before, resilience of our business model. But perhaps most importantly, this is now our fourth consecutive quarter where we see positive KPIs. That tells you that what we are seeing now is not just a temporary uplift, but it is the result of consistent disciplined execution. Let's move to the next slide, which gives us a bit more insight on the growth drivers. So again, similar numbers, but let me look from a growth perspective and share a few more insight. When I look deeper into what has been driving our growth, what you can see is a very encouraging picture across all the geographies. We saw a growth of revenues of around 32% in the UAE. This was driven by strong wins in health and life as well as growth in property/casualty. Rate improvements completed really the overall business strength, which we are seeing now and is a momentum which carries forward in the rest of 2025 and into 2026. In Saudi Arabia, our revenues grew by 23%, supported by motor expansion, but also by a strong business in the non-motor side on the facultative lines of business where we had reinsurance inward. In Oman, we achieved a 9% growth, largely through health win-backs, clients who returned back to Liva after being with auto insurers for a period, maintaining really our long-standing #1 position in the market. From a profitability standpoint of view, the UAE led the way with strong results going through the first half of this year. Oman is still carrying legacy challenges, particularly some on group medical as well as on third-party motor, which weighted on the results. But even here, we are seeing positive signs of stabilization. And in Saudi Arabia, we continue to deliver profit, underpinned by strong investment returns. This diversity of growth drivers across geographies and lines of business gives us really the confidence in the sustainability of our performance. Now talking about the diversification, maybe Sara you can guide us to the next slide, which shows us a bit more details. What you can see here is really the diversification, not only geographically but also by line of business. Let me dive in a bit deeper on the left side on the geographic diversification. When we look at our spread, the 3 core market remain UAE, Oman and Saudi Arabia. These are the markets with strong fundamentals and critically with significant headroom for further growth. In particularly, the UAE and Saudi Arabia are the fast-growing insurance markets in the region. Our presence, capabilities and partnerships position us strongly to capture this growth in a disciplined way. When we speak about diversification, Saudi Arabia is a prime example of where we are combining organic growth with a strategic inorganic expansion. Our proposed merger with Malath is progressing well, and we are going through the various steps as every M&A transaction has to go. But we are hoping and seeing with this that beyond what we are doing today here in Saudi Arabia, this transaction will enhance diversification, not only in Saudi Arabia but across the group, giving us a broader, more resilient platform for the long term. From a product perspective, what you can see on the right-hand side on the slide, we see a well-balanced portfolio, while medical and motor remain core of our business, and you can see it with 53% and 28%, our focus is deliberately to grow the non-motor lines of business and also to bring much more emphasis on life insurance. This balance ensures that we are not overly dependent on one geographic or one product line, but really develop a much more resilient and much more diversified organization as we move ahead. The bottom line is that in half 1, we outperformed the market in all of our core markets. That is a powerful validation that our strategy and execution are working exactly as we planned for. Now we have on Slide 9, regional highlights. I'm not sure we have Dr. Dhafir here because he wanted to guide us through. I'm not sure he managed to join us. I think he's not yet here. So to -- let me lay it out a bit because what we do here, we want to deep dive maybe in 2 or 3 of the key markets. When we look from a regional perspective, I summarized the group. But maybe if I can hand over to Addal, who can guide us a bit on the highlights of the UAE and share some of the key achievements in Q1 on profitability and growth. And Addal, maybe if you can spend a minute or 2 just to guide us through UAE and Bahrain.

Sure. Thank you, Martin. I think H1 has been a strong performance for the UAE business. The growth, as Martin said, has outperformed the market by 12 points. We've had a growth of 32% versus market about 19%. Profit after tax at OMR 9.3 million. I think the key focus for us over the last 12 to 18 months is really delivering technical underwriting results and a big focus on that. And that's demonstrated through on our health business, a strong combined ratio of 96% and our P&C at 83%. So -- and this technical focus remains in the coming period. So over the course of the last 12 to 18 months, we've had a lot of investment going into our technical capability, our data and our customer experience. And we believe these investments have set us up for the future period.

Thank you very much, Addal. Maybe, Hanaa, if you can give us an update on Oman and maybe a word on Kuwait.

Yes, sure. So as we can see, Liva Oman outgrew the market. Obviously, we've been looking at combining scale with a lot of focus. While the overall insurance market grew by over 3% in H1, Liva grew by 8%. So the main drivers -- sorry, by 9%. The main drivers were strong growth in life and health, nearly 40%, where we captured key accounts. We expanded our share. We also strengthened commercial lines through targeted renewals and getting new clients in while maintaining our share in the personal lines. So in parallel, we invested in automation, additional distribution, faster claims turnaround, all of this, which improved retention and member satisfaction. So these combined actions allowed us to expand our market share to 24% and reinforcing our position as the market leaders.

Thank you very much, Hanaa. And maybe last but not least, Mohamed on Saudi Arabia.

Thank you, Martin. Similarly, similar to UAE and Oman, KSA also delivered a solid growth of around 91% from GWP perspective and our insurance revenue grew by around 23% in H1 2025. This was mainly as a result of the strategy that we've implemented focusing on our technical expertise and discipline in areas such as P&C, where we've also delivered a strong combined ratio in the P&C as well. The focus for KSA continues on scalability as well as diversification of our portfolio. Majority of our growth comes from P&C as well as group life. For example, our P&C business grew by around 73% during H1 compared to the same period of last year. Our group life credit as well have grown more than 1,000% and capturing around 6% market share in the group level. Our results continues to be strong. Our strategy continues to focus on automation, achieving efficiency and serving our customers and being one of the best from a customer service perspective in the Kingdom.

Very good. Thank you so much, Mohamed. And again, for me, it's really always amazing when you're here and look into the market that you can see, when we take all this together, the regional stories show the strength of Liva's diversified model. Different markets are at different stages, but collective, they give us resilient, balanced portfolio, which really allow us to grow and perform what we saw when we looked at the numbers before. But thank you very much. Maybe let's jump into the next topic on investment performance, which is on the next slide. We put a few elements together. And again, I will run you quickly through this. On the investment side, again, we see overall obviously a strong contribution to the portfolio or the performance of the company. In the first half of 2025, investment income increased by around 9% year-on-year, reaching the OMR 7.5 million. This is an important achievement, particularly against the backdrop of a declining interest rate environment. The yields in the market have been coming down, but we have been able to cushion the impact through active rebalancing of our portfolios. A key driver has been the ability to align the maturity profiles of our assets with the insurance liabilities. By strategically locking into longer tenure investments at higher interest rates before the market shifted, we secured sustainable returns that offset the falling interest environment, which we are seeing now. At the same time, we have taken steps into improving cash flow from receivables, reinsurance settlements and operations at large, which then helped us to support a stronger asset base for the group. The asset mix itself is deliberately balanced, what you can see on the slide here. So we continue to invest primarily in high-quality low volatility assets such as fixed deposit, corporate bonds, government securities, in line also with the regulatory requirements. These portfolios remain fully compliant with all regulatory frameworks in each of the jurisdictions we operate, where restrictions on asset types, exposure limits, geographical allocation are strictly observed because that's the foundation of our strategy to ensure. But having said so, looking ahead, we expect that the overall portfolio mix can gradually evolve. While fixed deposits remain important, we are marginally diversifying into other permitted asset classes where we see potential for better returns while still maintaining the prudence and stability that investors and regulators expect. Alongside these investment initiatives, we have also taken decisive steps to strengthen our financial flexibility. In the first half, we consolidated our borrowings into a new facility with Sohar International Bank. This refinancing not only lowers our financing costs but also gives us greater flexibility to support growth opportunities as they arise. Finally, I want to emphasize that Liva remains a strong capital position. Our solvency levels are comfortably above minimum regulatory requirements across all our entities to ensure that we have the resilience and that we are also well prepared to absorb volatilities by continuing to invest in future growth. So in summary, our investment results is not just about return on paper. It's about how we actively manage our portfolio and our balance sheet to deliver resilience, efficiency and flexibility, all of which underpin our ability to sustain profitability over the long term. Now if I move now more to the strategic outlook on the next page. Maybe Sara, if you can move us onto it. I want to share a few examples and go into few elements to give you an outlook what keeps us busy and what we are doing currently. So as we look ahead, I would really like to share a few of the strategic initiatives to give you, again, more color what we are doing and where we are expanding. Firstly, for example, on life expansion. Life insurance is one of the fastest segments in the region. And it's clearly, which is opportunity, which not only for Liva but for the market is very important to establish because the demand of the markets of the customers are there. So for example, in Saudi Arabia, we are now accelerating to a distribution partnership via life offering. In Oman, we see also potential to partner with banks to deliver Liva life solution to a broader customer base. This focus on life coupled with investment into system, processes and people will really help to complete and complement the existing portfolio. Secondly, the portfolio on the P&C, which is not just growing P&C, but also the product mix and expansion, which is very important. We are deliberately reshaping our property/casualty portfolio to focus on profitable non-motor and commercial lines. I often say that the profitability driver of many insurance companies, if you can manage the volatility, is the commercial line. So this is why it's very important that we support this strategy by refreshed reinsurance structures, but also by strong broker relationships, by coinsurance partnership. And as we keep on growing and expanding the margins and the resilience in going through the cycles of the market, we will be significantly higher. Looking on the health side, even there, we have many initiatives which are quite important to us. So for example, health ecosystem place is something we invest time and money to really bring up new solution on digital health, telehealth or even product innovations. For example, we are expanding group medical offerings in the Northern Emirates in the UAE, really to drive also innovation through new systems, new integrations, what we can see in Oman through the Omani platform. All these initiatives will differentiate Liva and build customer loyalty and also increase a competitive advantage compared to other players in the market. Let me also quickly talk about strategic partnership. This is something we always talked about, and we will continue talking about because it is in the core of Liva to continue strengthening our ecosystem where partners are coming together with Liva and providing solutions to their customers and our customers, whether through Relm, Salik, Tesla, Omantel, our focus is really the alliance that brings shared values, where the win for the customer, the win for the partner and the win for us is there, founded on technology and technological innovation and expanded reach to customers to help and support the insurance penetration, particularly in parts where insurance products are not available. So these collaborations are really a key for us to scale faster and deliver solution that resonates with our customers. So in short, our outlook is not about chasing growth for its own sake. It's about diversification, it's about scale and the sustainability. Building a business that is broader, more resilient, better aligned with the evolving needs of our markets. Now again, while looking at these elements, I think we need to move to the next slide, which is the core enablers because no strategy will come to life without strong enablers. And that's where I summarized briefly a few elements, which are some of the key drivers, how we are delivering and how we are differentiating at Liva. Digital enablement. Technology is at the heart of our strategy. Over the coming quarters, we will be piloting automation in claims and underwriting, which will mean we have much faster decisions, greater consistency and fewer manual errors. We are also investing into AI-enabled pricing models that allow us to assess risks with greater accuracy and respond more swiftly to market changes. These are not just efficiency plays. They are really here as a source of competitive advantage, creating a seamless and modern customer experience. Then efficiency and cost control. Operational excellence is a cornerstone of our resilience. By tightening expense ratios, managing cost proactively and ensuring reserve adequacy, we safeguard our margins and maintain flexibility. In a world where claims volatility and investment swings are real risk, efficiency becomes not just an internal metric, but really a key driver and enabler for sustainable shareholder value. Looking at customer centricity, the customer centricity remains at the heart of everything we do. We are enhancing digital touch points to make sure that the service for the customers are really all-encompassing, but also adding convenience, transparency and accessibility. A recent example is the launch of our web app in Oman, which makes the policy management and claims submission easier than ever. Over time, we also intend to replicate and scale this innovation across all the other markets in the GCC, deepening the engagement and loyalty with our customers. Technical excellence. Well, none of all what I just said works without strong technical foundation. At the end of the day, we are an insurance group. And we will continue to apply all the discipline in pricing, careful risk selection, optimized reinsurance structures, but also the growth focus and portfolio management focus, which is really core and key to make sure that whatever we do today is sustainable tomorrow and the day after. Leading me to social responsibility. Our responsibilities go beyond financials. We are embedding ESG and CSR into our operations, aligning it with international standards in reporting, but also making sure that we are making a tangible contribution on the ground. That's from road safety campaigns up to financial literacy programs or even community health initiatives we run in some of the key markets. We really are here to demonstrate. Our growth is inclusive, responsible and sustainable. And I wouldn't say last but not least, but it is definitely not least, it's the people and culture. Our people remain our strongest assets. We are investing in leadership development in our key markets, but equally, we are strengthening localization across the markets. This is not just simply to meet regulatory requirement. It's really about building trust, reinforcing credibility and ensuring our workforce reflects the communities we serve. A culture of accountability, collaboration, inclusiveness, that's really what we carry in the heart, what Liva is and what Liva stands for. So when we talk about outlook, it's these enablers, technology, efficiency, customer responsibility and people that will really allow us to deliver on our ambition. They ensure that we are not just growing, but growing with resilience, growing with purpose and with strong long-term vision and creating value for the future in mind. Again, I rushed through so many of the slides because I really wanted to allow you to ask questions. So I think with that, I'm ending my speech here and hand back to Sara then that she can guide us through the Q&A.

Thank you very much, Martin, and to our speakers today. I'd like to open the floor for any questions that our guests may have for today's session. [Operator Instructions]

Of course, it can also be because we presented so well that you don't have any questions. We answered all your questions, but happy to take any feedback, comments.

Mr. Sandesh says he has a question. You've raised your hand. I'd say, we ask you to unmute and ask the question.

Congrats on a great set of results. My first question is regarding like are there any strategic partnerships, acquisition or joint ventures that you have planned in UAE or Saudi Arabia that could accelerate your market share in those regions, like any plans which are in place?

Thank you very much for your question. I'll open the floor to Mr. Martin to please respond.

Definitely. Thank you very much. And very good question. And I would probably answer it in two parts, one more from as you ask a strategic narrative, but then also from a more operational side. From a strategic narrative, clearly, Liva is built in making sure that we enhance our presence. And again, on all the key drivers we just went through. It needs scale and scale is very important to also ensure the diversity and sustainability of operations. So the answer is yes, we are always looking into where are the gaps in our operations, where are also the needs of our customers and how with partnerships, with acquisitions, with investments or with any other means as joint ventures, we can bring such solutions to our customers. And if we do it in one market, we also have obviously aim to make sure that we can expand it across all the markets. So the answer is, yes, we continue doing this, but again, very much focused on where we have gaps in our offerings, where we need to balance out the elements. So in more operational side, again, while the integration of the 2 companies into Liva, which was National Life and General Insurance and RSA is completed in most parts. There's one last piece on the portfolio transfer in the UAE, which we are closing later this month. We saw that in some of the markets, we had, I would call it, blind spots. And that's exactly then where from a strategic operational perspective, we quickly started looking into opportunities to either partner up or inorganically close it. And Saudi Arabia being one where it's a scale question, but it's also a question on health offering. As you saw, health is our strongest business line and Saudi Arabia is, of course, a big driver on health. So there is the tactical elements, but then partnerships such as Tesla, such as Relm, such as Salik, are very much, I would say, on our focus, again, as a diversification, but also a differentiation strategy. And yes, we are continuing exploring such partnerships. There are 1 or 2 in the UAE and Saudi as well in Oman in the making, and we hope that we will be able to share more as we go through the second half of this year.

Okay. Understood. Thank you for the answer. And my second question is regarding your cash balance. Cash and bank balance currently stands at around OMR 44 million, if I'm not wrong. What are your plans for this cash? And also given the improved financial position, which we have seen in the last 12 months, should shareholders anticipate a resumption of dividend payments in the near term?

Again, obviously, the year is not over. We need to go through the rest of the year. But clearly, as you said, we see a strong bounce back from last year. We also have a high level of certainty now in the claims of 2024 and the underlying businesses are operating quite in a stable environment and in a predictable environment. With this in mind, again, it is very much driven that we are focusing now on investment improvements because, again, cash balance is not where we obviously want to keep our cash. We want to invest it and reinvest. But then at the same time, as we said, from a shareholder perspective, the last 4 quarters have been very positive, very strong results, and we anticipate we will continue the rest of the year to deliver strong results, which in turn will then most probably lead to, again, allowing us to return to our normal dividend policies, which we had in the past, which we had to suspend during 2024, mainly on the back of the results which didn't support.

Thank you very much, Martin, and thank you, Mr. Sandesh for asking the question. I'd like to open the floor again for any other questions that our guests may have. [Operator Instructions] Mr. Tahir Abbas, please go ahead. [Operator Instructions]

Thank you for the detailed presentation and on your superb results. I have just quick 2 questions. First is, looking at your geographic mix, again, too much concentration on UAE. So from a strategy perspective, do you feel like -- obviously, nobody can predict the natural disasters and calamities, but don't you feel like that it should be more diversified? And the follow-up question on that, relating it to my second question, that you are outpacing the market growth rate in KSA and UAE. Should we expect a more aggressive strategy towards the Saudi market, given my first concern is correct in your opinion?

Very good question, and thank you very much for asking. And I would put it in maybe again, 2 parts. You are right when you look at the exposure, but also when you overlay the GCC markets, the largest market is Saudi Arabia, the second largest is the UAE, then again, with big gaps to the smaller market. So in other words, any player who focuses and has a strong focus on the GCC will have a big exposure in Saudi Arabia and the UAE. Now the second part is, yes, we are not represented to the extent we should in Saudi Arabia. So that's where, to your question, yes, we need to accelerate Saudi Arabia, but we need to do it in a sustainable way. And that's where for us, the inorganic route by bringing our operations together potentially with somebody like Malath, who is very strong on health and other offerings, then what we are bringing, which is the P&C side of things, could really change significantly the overall portfolio mix across the GCC. And with this then also build a platform for where we can grow. What you can see when you look across the GCC again, you need to have the scale and then it goes back to cost discipline and cost efficiency, which allows you to really support the significant growth. And if you don't have the scale, it becomes extremely difficult. And that's where the growth need to support. And with that, the efficiency drives, which we have in all the entities, the investment into technology, into really ensuring that the business model become much more variable cost than fixed cost will help us to support the growth and also sustain the margins despite markets in itself going up and down. So in answer, yes, we want to diversify wider than in the UAE, as we said, we saw in 2024 nat cat. Of course, we also optimized the reinsurance after those events significantly. So it's similar things, which we hope will not happen or shouldn't happen for very, very long. But again, we strengthened reinsurance, we strengthened underwriting as us, but also as a market, which is in response to such events, which should derisk a bit the element of overexposure in the UAE. But then strategically, mid- to long term, there is also the element of exposure where you go beyond. So what we have already in the UAE business, there is some facultative inward business, for example, from other non-UAE markets, which is booked through the UAE, which again allows us to diversify, and that's also a strategic avenue we are exploring how can we, I would say, accelerate the diversification, which allows us exactly responding to what you said, where ideally, not only in the GCC, but even beyond the GCC, where we have lesser exposure to nat cat or even geopolitical events or economic events that we make sure that we bring more and more resilience.

Thank you very much, Martin. I believe Mr. Tahir has another question.

Yes, thank you, Martin for the detailed answer and explanation. Just my last question that if you could possibly share some light on the margins, specifically for the insurance business, cumulative insurance business region-wise. So I just wanted to have an idea that which region has got the highest margin and which is the second one and which is the third one? I'm just talking about KSA, UAE and Oman.

Yes. So again, I'm speaking on behalf of the market, which is very much also aligned what we are seeing. And again, we are outperforming in most of the markets. But clearly, I think today, Oman is the most challenging market on the back of motor and also group health with Omani and the volatility, which I think came into the market. When you look from an insurance technical perspective, not many companies are able to create value creation through the insurance operations. It's mainly driven through investments, which then can absorb some of the claims. In Saudi Arabia, in itself, it's the largest market, but again, it's a huge pressure on the technical margins. And only large-scale player who have the advantage of single-digit expense ratios, expense allocations, they have usually chances to technically make profit, but also the scale and the diversification allows them to, I would say, attract some of larger schemes or larger even government-run schemes, which in itself, again, help to diversify. When you look at it, I would say it's not even 20/80, it's 2, 3 large players in Saudi Arabia who are making solid and good profit technically, even excluding the investment, but the rest of the market is in a loss position there. Where the UAE is currently as a market, profitable technically. But of course, it's also a question of the late claims we saw coming through in the UAE in 2024 on the back of the rains. So we saw a strengthening on rates of motor. We saw an increase in property rates, construction rates on the back of higher reinsurance costs, which hit the local insurers or older insurers in the market, so to compensate some of it. So UAE, I would say, has currently the strongest rates. Saudi Arabia, depends where you are. If you have scale or in a niche, you have margins which are positive. And Oman currently is quite under pressure to overcome, particularly motor and some of the health challenges. In summary, I would put it like this.

And just last follow-up, please. So do we expect -- let's say, obviously, there's an expectation of decline in interest rate globally. So do we expect increase in betterment gap. Like I can understand that majority of the income has been derived from investment. But obviously, those are the portfolio managers which you people have hired and they are doing their job. So I'm just particularly asking for the insurance business. So for instance, let's say, global interest rate will get down in the next 1 year, 1.5 years, and we are aware that the whole GCC policies are backed with the U.S. So do we expect some improvement in the margin as obviously, the total -- I would assume the total project cost of different large-scale projects under Vision 2030 and some UAE projects, Oman Vision 2040, their finance costs will go down. So obviously, when you renew your insurance policies or there would be some new projects, so would it help in like getting better margins for you guys?

Yes. So from a lever perspective, I would respond. Our key, and that's why I emphasize quite a lot on diversification and also on scale because we are gaining scale and quite significant scale, and that's where our margins will -- and again, our plans are really to keep and improve the margins because, again, as we said, Saudi Arabia is already under pressure. So again, you have high loss ratios and if your expenses and commission are -- or let's put it this way, losses as well as commission are very market-driven. So the differentiator becomes very much how you operate and your operational efficiency, which then creates positive or negative margins. And when you look at negative margin is usually driven by cost and cost is driven either by inefficiency or by scale. And most players have a scale issue where us as a group, we have the scale. And that's where -- when I use there's a few examples where we also roll out initiatives across the group because we are doing something in Oman. And if that's good, we use it in the UAE, we can use it in Saudi Arabia, Bahrain, Kuwait, and that again helps us on the cost efficiency. So yes, we anticipate and we plan to improve our technical excellency. We always say we are doing two things. We are an insurance company. We need to be technically profitable. So we are not here to generate just cash for investments. But the second part, yes, is investment. We need to optimize and see how we respond to global and regional trends on investments. But technically, we need to constantly improve our margins, which, again, is diversification, new product, new offering. I talked about life insurance, which again, in itself is a new product line, which will have impact on the way the portfolio mix will start to diversify more and allow us to gain scale and with this, also have higher efficiencies and hence, I would say, sustainable positive margin out of the technical insurance business.

Thank you very much. I'd like to open the floor for any final questions. Thank you, everyone, for joining today's session. As there's no other questions, we will conclude the session for today. I'd like to thank everyone for their participation, and I wish you all a pleasant remainder of the day. Thank you all for joining.

Thank you very much.

Thank you.