BankMuscat, National Life plan insurance-linked savings product

BankMuscat and National Life Insurance Company SAOC, the country's largest life insurance firm, are in the process of developing a life insurance-linked savings product, perhaps the first of its kind in the entire Middle East.
According to official sources, BankMuscat has moved closer towards a formal deal to pick a 20 per cent stake in National Life this year, in addition to the present two per cent.
It is learnt that the country's largest commercial bank together with American Phoenix, a subsidiary of the US-based Phoenix Home Life, may pick over 50 per cent stake in the life insurance company has a five per cent stake in National Life.
It is also learnt that National Life's last week board meeting was primarily focused on issues relating to its future business strategies and the proposed change in the equity pattern.
According to sources, customers of both the bank and the insurance company will have an opportunity to have a unique financial product, that too perhaps for the first time in the region.
According to an interim report submitted to the market regulator, National Life's net assets stood higher at RO5.09 million as of June-end 2001 compared with RO4.58 million as of June-end 2000.
Net profit for the period stood at RO252,059 compared with RO25,579. Gross premia rose to RO4.02 million compared with RO2.90 million.
Net premia stood at RO3.45 million compared with RO2.38 million. Its investment income stood at TO568,918 compared with RO399,725. The bank deposit as of June end stood at RO10.97 million compared with RO7.46 million.
These deposits both short term and long-term carry interests ranging from 3.75 per cent to 8.5 per cent.
Loans to policyholders stood at RO525,655 compared with RO407,379.
These loans carry an interest rate of 9.5 per cent per annum.
Its life fund as of June-end 2001 stood at RO11.44 million compared with RO11.44 million compared with RO10.77 million.
The company's major share holder, Onic Holding has a 93 per cent stake in the company.
Total shareholders' equity stood at RO5.09 million compared with RO4.58 million as of June-end 2000.
The company is not licensed to transact in general insurance business.
National Life has over 52 per cent market share in the domestic life insurance market. Lately, Fitch, the world's third largest full service rating agency, assigned a 'national insurer financial strength' rating to National Life Insurance Company. It has rated the out look as stable".
According to market sources, Muscat Life and Dhofar Insurance Company share the second and third ranks respectively. Dhofar Insurance, the only listed insurance company in Oman has a market share of over 12 per cent.
Majority of its income is delivered from underwriting portfolio of group life risks and credit life generated by the Omani banking sector with the company providing insurance coverage for the majority of retail banks within the country.
The company's individual life insurance business, together with the income derived from insurance activities in other AGCC countries is still at an early development stage.
The company, which claims about two-thirds of group life insurance and one third of the individual life market domestically is in the process of developing a broad range of marketing initiatives to further accelerate the growth process within the sultanate and other selected markets.
National Life's prestigious schemes such as money-back; savings plus, group life and lifestyle have been receiving overwhelming response from the nationals.
National Life is a 93 per cent subsidiary of Onic Holding. The affairs of Onic Holding are currently managed by a seven member steering committee appointed by the Capital Market Authority (CMA).