59th annual report - jordan insurance company · 2018. 4. 18. · 2009. loss ratio in 2010 was...

Raising your ambitions to the top.

2010

59thAnnual Report

Contents

Board of Directors’ Report 15

Independent Auditor’s Report 24

Balance Sheet 25

Income Statement 27

Changes in Shareholders’ Equity 28

Cash Flow Statement 29

Notes to Financial Statements 37

His MajestyKing Abdullah II Bin Al-Hussein

His Royal Highness CrownPrince Hussein Bin Abdullah II

This is to certify that the

Jordan InsuranceCompany

has won the award for

Best Insurance Companyin Jordan

Clive Horwood, Editor

WINNER

Jordan Insurer of the Year

Jordan Insurance Company

Branches

Kuwait

Amman

Dubai

Abu Dhabi

Sharjah

Aqaba

11

Contact Us:

Head Office - 3rd Circle - AmmanP.O. Box 279 Amman 11118 JordanTel.: +962 6 4634161Fax: +962 6 4637905E-mail: [email protected]

Madina Branch - AmmanP.O. Box 1276 Amman 11118 JordanTel.: +962 6 4638108Fax: +962 6 4646917E-mail: [email protected]

Aqaba Branch P.O. Box 1415 Aqaba 77110 Jordan Tel.: +962 3 2039194Fax: +962 3 2039193E-mail: [email protected]

Our Branches:

United Arab EmiratesAbu Dhabi: Tel.: +971 2 6344800 Fax: +971 2 6330495Dubai: Tel.: +971 4 2698810 Fax: +971 4 2692174Sharjah: Tel.: +971 6 5395566 Fax: +971 6 5395556

KuwaitKuwait: Tel.: +965 2 454160 Fax: +965 2 454180

Board of Directors

General Manager

Mr. Imad M. Abdel Khaleq

Mr. Othman M. Bdair

(Representing Arab Technical Constructions Co.

H.E. Mr. Waleed M. Asfour

Mr. Osama J. Sha’sha’a

Mr. Christian Kraut

(Representing Munich Re Co.)

Mr. Shehadeh Sh. Twal

Mr. Imad M. Abdel Khaleq

Mr. Kamal Gh. Al-Bakri

(Representing Al-Maseera Investment Co.) until 1/3/2010

Mr. Kamal Gh. Al-Bakri since 1/3/2010

Mr. Samih Madi

Mrs. Huda Bdair

Mr. Mohammed M. Ennab

(Representing Arab Supply & Trading Co.)

Miss. Aya Kh. Abu Hassan

Chairman

Deputy Chairman

Director

Director

Director

Director

Director

Director

Director

Director

Director

Auditors

Deloitte & Touche (M.E.)

Deputy General Manager

Finance & Administration

Secretary of the Board

Mr. Mustafa M. Dahbour

12

Board of Directors’ Report

In the name of God, the Most Merciful,the Most GraciousDear Shareholders,

Peace be upon you

The Board of Directors is pleased to welcome you to

the 59th Ordinary Meeting of the General Assembly

and to present its annual report for the financial year

ending on 31/12/2010.

The year 2010 was characterized by instability that

has resulted from the ongoing impact of the global

financial crisis on both the public and private

sectors. This has had an obvious impact on the

national economy as the output gap is still negative

when compared with the 2000-2008 period, which

averaged 6% in terms of real GDP growth. Measures

taken by the Government and the Central Bank of

Jordan (CBJ), such as the reduction in interest rates,

the reduction in Banks’ Required Reserve Ratio,

maintaining Deposit Guarantees until the end of

2010, fiscal reforms including tax cuts and

exemptions, have all mitigated the adverse effects of

the crisis. Economic growth stood at 3.4% in 2010,

compared with 2.3% during the previous year.

Since inflation rates in Jordan are directly linked to

global commodity and energy prices, they have

reached their peak in 2008 and subsequently

dropped in 2009. However, expected inflation

remains high due to the resurgence of commodity

and energy prices. Inflation continues to be

influenced by food and energy imports, which

reduces the effectiveness of CBJ’s efforts to curb it,

and this in turn affects expected growth rates.

Moreover, in 2010, the Amman Stock Exchange

(ASE) trading value reached JD6.7 billion

compared to JD9.7 billion in 2009. The Amman

Stock Exchange (ASE) price index weighted by free

float shares closed at 2374 points with a drop of

6.3% compared with the closing of 2009, which

stood at 2533 points.

As for the insurance sector in Jordan, the growth rate

of insurance premiums reached around 12% in 2010,

which is indicative of the limited effect that the

current economic situation has on this sector.

It must be noted that the insurance sector has been

experiencing unhealthy competition, especially in

pricing. This draws a huge question mark on the

fate of this sector and its ability to serve the national

economy. In order to ensure their survival,

Jordanian insurance companies must reconsider

their underwriting and investment policies and

coordinate among themselves, as well as activate the

role of the Jordan Insurance Federation in this

regard, in addition to keeping the Insurance

Commission, the direct supervisory entity of this

sector, informed of the risks that threaten the

survival of many of the companies as a result of

lacking response to calls for reconsidering

compulsory insurance prices and the companies’

mechanism of dealing with this type of insurance.

Despite the difficult economic circumstances, JIC

has maintained its performance level and has

accomplished good results when Gross Written

Premiums reached JD42.75 million with an increase

of 7% compared with last year, resulting in technical

profits of JD4 million, while the net profit reached

JD3.1 million after taxes and fees. Whereas JIC’s

Gross Written Premiums in Jordan had increased by

11%. This has enhanced JIC’s ability to maintain its

leading position in the Jordanian insurance sector in

terms of results. As for JIC’s market share in the local

market, it reached 9%.

It is worth noting here that in 2010, A.M. Best, the

leading and most authoritative global insurance

rating agency, has upgraded JIC’s Issuer Credit

Rating (ICR) to bbb+ compared with the rating of

bbb in 2009. Meanwhile, it affirmed JIC’s Financial

Strength Rating (FSR) B++ (Good) Outlook (Stable)

for both ratings.

Letter from the Chairman

15

This rating was the result of JIC’s high level of

professionalism and exceptional performance in

the provision of its insurance services at the local

and regional levels, and for maintaining this

performance under all circumstances, especially

during the global economic crisis that had a

negative impact on the rating of many insurance

companies in the world. The rating action reflects

JIC’s leading business position in Jordan in terms of

strong technical profitability and financial solvency,

as well as strong risk-adjusted capitalization.

This rating constitutes a point of strength factor that

is of utmost importance for the Company. It raises

the level of its competitiveness, enhances confidence

locally and abroad, and opens the door for regional

expansion, being one of the ten best insurance

companies in the Arab world to be awarded this

rating.

JIC was also able to renew its reinsurance treaties for

2011 with elite global reinsurance companies and

with improved terms and rates than previous treaties

and in a manner that serves the best interest of both

parties. This is the result of the Company’s high level

of professionalism and its credibility and trust that

have been the basis of its relationship with reinsurers

since its establishment.

Branches

JIC’s branches in the United Arab Emirates and our

Agency in Kuwait have achieved high technical

results that reflect your company’s exceptional

standing with its clients in those markets, despite all

the challenges and restrictions facing the insurance

business in these markets. Written premiums in

those branches reached JD6.48 million, representing

15% of JIC’s total production. Moreover, net profits

from these branches reached JD1.8 million.

Financial and Real Estate Investments

JIC continues to give its full attention to investment

based on the solid foundation of financial and real

estate investments. The Company has restructured

its financial portfolio this year, taking advantage of

the decline of activity in financial markets, which

eliminated most of the unstable shares and retained

the shares of strong companies. This has made it a

stable and promising portfolio and less affected by

price fluctuations. In this regard, real estate

investments have reached JD49.8 million as of

31/12/2010, being 72% of the Company’s total assets.

JIC continues to perform capital maintenance of its

building base with the purpose of upgrading them

and making them more suitable and more attractive

to tenants. We hope this process will conclude in

2011, enabling the Company to maintain lease rates,

which constitutes a good support for JIC’s net

results. We also hope occupancy rates will reach the

highest levels.


16

The Future Plan

1. Continue to expand horizontally by opening new branches in neighboring markets.

2. Adhere to the Company’s strategy of preserving its leading position in the local market through prudent

and disciplined underwriting policy.

3. Continue to train staff in line with JIC’s policy of maintaining a high level of professionalism in the service

of its clients and providing qualified staff to serve the expansion strategy.

4. Provide Bancassurance services with leading banks.

5. Pursue expansion through mergers and acquisitions.

6. Upgrade IT applications and develop the IT department.

7. Maintain JIC’s rating and build on it.

8. Establish a Risk Management Unit.

In conclusion, the Board of Directors would like to extend its thanks and appreciation to all our employees

who contributed to the success and accomplishments of the company, and to all our clients and for their

continued trust and support, as well as our reinsurance partners for their devotion and loyalty.

We ask God Almighty to guide us towards success in the services of our national economy under the

directives of His Majesty King Abdullah II Bin Al-Hussein.

CHAIRMAN OF THE BOARD

Othman M. Bdair


17

“These statements are selective extracts from the English Financial Statement and should be read together with it.”

Insurance Premiums

20082009

The overall premiums written by the Company during 2010 was distributed between lines of business as follows:

- Marine:Gross Written Premium during the year 2010 was JD2,858 million compared to JD2,917 million in 2009.Loss ratio in 2010 was 11.57% compared to 98.50% in 2009.

- Fire & General Accidents:Gross Written Premium during the year 2010 was JD13,413 million compared to JD12,849 million in 2009.Loss ratio in 2010 was 16.12% compared to 69.92% in 2009.

- Motor: Gross Written Premium during the year 2010 was JD14,322 million compared to JD14,220 million in 2009. Loss ratio in 2010 was 65.44% compared to 59.18% in 2009.

- Life: Gross Written Premium during the year 2010 was JD7,526 million compared to JD6,149 million in 2009.Loss ratio in 2010 was 82.78% compared to 63.19% in 2009.

- Medical: Gross Written Premium during the year 2010 was JD4,711 million compared to JD4,074 million in 2009.Loss ratio in 2010 was 55.14% compared to 59.59% in 2009.

20062007 27,506,936

14,371,309

(313,552)

2,921,207

16,978,964

8,234,663

6,701,814

14,936,477

2,042,486

1,468,083

33,852,854

16,994,557

1,350,921

4,240,764

22,586,242

10,715,291

16,414,982

27,130,273

(4,544,030)

(5,399,565)

38,334,750

17,744,127

6,582,919

3,618,410

27,945,456

10,705,879

7,715,516

18,421,395

9,524,061

8,460,011

39,848,033

18,786,929

466,942

3,905,510

23,159,381

11,122,650

8,117,116

19,239,766

3,919,615

3,006,339

42,829,781

20,502,363

759,216

3,275,760

24,537,338

12,470,937

8,745,372

21,216,309

3,321,029

3,114,693

2010Gross Written PremiumNet Earned PremiumInvestment ResultOther RevenueTotal RevenueNet Claims PaidOther ExpensesTotal Expenses Result Before Taxes

Net Result After Tax

Income Statement Information

18

Reinsurance GWP ShareGross Written Premium

Gross Claims Paid Reinsurance Share

Balance Sheet Information

19

InvestmentReal EstateFinancial InvestmentOthersTotal AssetsShareholders' Equity

33,783,796

6,107,315

27,571,695

104,786

48,843,436

28,501,513

42,701,113

5,983,339

36,598,776

118,998

61,458,769

35,740,138

44,231,313

6,049,552

38,111,421

70,340

65,864,911

40,629,097

53,541,151

12,103,677

41,359,607

77,867

72,699,072

48,242,555

49,775,938

17,486,212

32,204,070

85,656

69,083,632

45,302,444

20062007200820092010

Gross Written PremiumReinsurance GWP Share

Gross Claims PaidReinsurance Share

27,506,936

12,370,465

14,133,386

6,208,463

27,506,936

15,482,154

15,381,756

5,811,706

38,334,750

20,436,321

15,522,043

5,878,069

39,848,033

21,049,828

19,709,834

9,075,322

42,829,781

22,197,806

18,498,621

7,673,669

20062007200820092010

40

30

20

10

020072006 2008

JOD

Mill

ions

Year

Board of Directors’ Report

2009 2010


Technical Profit

Capital Growth

20

200820072006

JOD

Mill

ions

Year

30

25

20

15

10

5

020052001198719821952 1962 2006

JOD

Mill

ions

Year

Technical Profit200820092010

3,121,0553,316,7584,573,7404,641,8344,001,898

20062007

Paid-up Capital 1,100,0005,000,00010,000,000 400,000 100,000

1987200120,000,000

200530,000,000

2006 1982 1962 1952

5

4

3

2

1

02009 2010


Financial StatementsFor the Year Ending 31/12/2010

Management’s Responsibility for the Financial Statements

Management is responsible for the preparation and fair

presentation of these financial statements in accordance with

International Financial Reporting Standards, and for such

internal control as management determines is necessary to

enable the preparation and fair presentation of financial

statements that are free from material misstatement, whether

due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express an opinion on these financial

statements based on our audit. We conducted our audit in

accordance with International Standards on Auditing. Those

standards require that we comply with ethical requirements and

plan and perform the audit to obtain reasonable assurance

whether the financial statements are free from material

misstatement.

An audit involves performing procedures to obtain audit

evidence about the amounts and disclosures in the financial

statements. The procedures selected depend on the auditor’s

judgment, including the assessment of the risks of material

misstatement of the financial statements, whether due to fraud

or error. In making those risk assessments, the auditor considers

internal control relevant to the Company’s preparation and fair

presentation of the financial statements in order to design audit

procedures that are appropriate in the circumstances, but not

for the purpose of expressing an opinion on the effectiveness of

the Company’s internal control. An audit also includes

evaluating the appropriateness of accounting policies used and

the reasonableness of accounting estimates made by

management, as well as evaluating the overall presentation of

the financial statements.

We believe that the audit evidence we have obtained is sufficient

and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the financial statements present fairly, in all

material respects, the financial position of Jordan Insurance

Company as of December 31, 2010, and its financial

performance and its cash flows for the year then ended in

accordance with the International Financial Reporting

Standards.

Report on Legal Requirements

The Company maintains proper accounting records and the

accompanying financial statements are in agreement therewith

and with the financial data presented in the Board of Directors'

report. We recommend that the General Assembly of

Shareholders approves these financial statements.

The accompanying financial statements are a translation of the

statutory financial statements which are in the Arabic language

and to which reference should be made.

Amman – Jordan Deloitte & Touche (M.E.) – Jordan

February 17, 2011

We have audited the accompanying financial statements of Jordan Insurance Company, which comprise the statement of financial

position as of December 31, 2010, statement of income, statement of comprehensive income, statement of changes in shareholders’

equity and statement of cash flow for the year then ended, and a summary of significant accounting policies and other explanatory

information.

AM/7953

To the General Assembly

Shareholders of Jordan Insurance Company

(A Public Limited Shareholding Company)

Amman – Jordan

Independent Auditor’s Report

24

Deposits at banks

Trading investments

Available investments for sale

Held investments to maturity

Property investments

Loans and advances of the life department

Total Investments

Cash on hand and at banks

Cheques under collection and notes receivable

Accounts receivable - net

Insurance companies accounts - debit

Assets deferred tax

Fixed assets - net

Other assets

TOTAL ASSETS

3

4

5

6

7

8

9

10

11

12

13

14

15

Assets

To the General Assembly of Shareholders of

Jordan Insurance Company Plc.

Amman - Jordan

Balance Sheet

3,235,953

538,587

36,512,628

1,000,000

12,103,677

77,867

53,468,712

2,326,830

944,594

8,767,055

3,274,949

371,028

1,231,362

1,147,357

71,531,887

4,411,938

535,285

27,256,847

-

17,486,212

85,656

49,775,938

1,796,600

1,041,486

10,224,855

3,192,269

394,391

1,551,279

1,106,814

69,083,632


Financial Statements

25

Note

Number

JD JD

December 312010 2009

Mr. Othman M. BdairChairman

H.E. Waleed M. AsfourDeputy Chairman

Unearned premiums provision - net

Outstanding claims provision - net

Accumulated mathematical reserve - net

Other technical provisions

Total Insurance Contract Liabilities

Due to bank

Accounts payable

Insurance companies accounts - credit

Other provisions

Income tax provision

Other liabilities

Liabilities deferred tax

Total Liabilities

SHAREHOLDERS' EQUITY

Paid - up capital

Statutory reserve

Cumulative change in fair value

Retained earnings

Total Shareholder Equity

TOTAL LIABILITIES AND SHAREHOLDERS EQUITY

Liabilities

16

17

18

19

20

13

21

13

22

6,875,680

5,717,708

1,418,588

400,000

14,411,976

-

2,590,028

4,032,884

636,041

1,004,466

664,356

51,341

23,391,092

30,000,000

6,889,271

6,260,573

4,990,951

48,140,795

71,531,887

6,963,294

7,261,558

1,460,585

400,000

16,085,436

419,458

922,031

4,870,206

668,082

145,568

670,407

-

23,781,188

30,000,000

7,228,517

4,207,529

3,866,398

45,302,444

69,083,632


Financial Statements

26

Note

Number

JD JD


23

24

25

26

27

26

27

28

Income Statement for the Year Ended

Comprehensive Income Statement

Note

NumberJD JD


3,006,339

8,249,627

11,255,966

3,114,693

(2,053,044)

1,061,649

Revenues:Direct insurance - non life

Direct insurance - life

Deduct: Reinsurance share - non life

Reinsurance share - life

Net Written PremiumsChange in unexpired risks provision

Change in mathematical provision

Net Earned Premium IncomeCommissions received

Issuing fees

Interests revenue

Income from financial assets and investments - net

Other revenues

Total Revenues

Claims, Losses, ExpensesClaims paid

Subtract: recoveries

Reinsurance share

Add: maturity & surrender of policies

Net Claims PaidChange in outstanding provision

Allocated employee expenses

Allocated administrative expenses

Excess-of-loss premium

Commissions paid

Other expenses

Cost of Claims Incurred

Undistributed employee expenses

Depreciation & amortization expenses

Unallocated administrative and general expenses

Provision for doubtful debts

Fund expenses

Other expenses

Total ExpensesNet Income Before Income TaxProvisions for income taxNet Income

Earning per share

33,699,522

6,148,511

16,576,291

4,473,537

18,798,205 (102,490)

91,214

18,786,929 2,228,850

613,562

250,994

466,942

812,104

23,159,381

22,503,761

2,856,621

9,075,322

236,210

10,808,028 314,622

3,190,254

1,332,253

316,183

912,222

708,845

17,582,407

648,329

229,273

259,635

166,983

-

353,139

1,657,359 3,919,615

(913,276)

3,006,339

100/-

35,304,067

7,525,714

17,210,929

4,986,877

20,631,975 (87,615)

(41,997)

20,502,363 2,243,234

483,089

57,387

759,216

492,049

24,537,338

20,824,394

2,325,773

7,673,669

102,133

10,927,085 1,543,851

3,382,670

1,459,076

352,705

1,215,082

788,731

19,669,201

630,516

216,904

289,343

154,345

98,509

157,492

1,547,108 3,321,029

(206,336)

3,114,693

104/-

Net income

Comprehensive income items:

Cumulative change in fair value after tax

Gross comprehensive Income for the Year



Amman - JordanFinancial Statements

27 “These statements are selective extracts from the English Financial Statement and should be read together with it.”

JD JD


Consolidated Statements of Changes in Shareholders’ Equity

JD JD JD

NoteNumber

Paid-upCapital

StatutoryReserve Total

Cumulative Change

In Fair Value

31/12/2010

Balance - beginning of the year

Net income for the year

Cumulative change in fair value - net

Impairment loss in fair value

Comprehensive income for the year

Appropriated from profit to reserves

Dividends paid throughout the year

Balance - End of the Year

31/12/2009

Balance - beginning of the year

Net income for the year

Cumulative change in fair value - net


Comprehensive income for the year

Appropriated from profit to reserves

Dividends paid throughout the year

Balance - End of the Year

JD JD

RetainedEarnings

Jord

an

In

sura

nc

e C

om

pa

ny

A P

ub

lic

Sh

are

ho

ldin

g C

om

pa

ny

Am

ma

n -

Jo

rda

nFi

nanc

ial S

tate

men

ts 28“T

he

se s

tate

me

nts

are

se

lec

tive

ext

rac

ts fr

om

th

e E

ng

lish

Fin

an

cia

l Sta

tem

en

t a

nd

sh

ou

ld b

e re

ad

to

ge

the

r with

it.”

22

22

22

22

30,000,000

-

-

-

-

-

-

30,000,000

30,000,000

-

-

-

-

-

-

30,000,000

6,889,271

-

-

-

-

339,246

-

7,228,517

6,484,627

-

-

-

-

404,644

-

6,889,271

4,990,951

3,114,693

-

-

3,114,693

(339,246)

(3,900,000)

3,866,398

6,139,256

3,006,339

-

-

3,006,339

(404,644)

(3,750,000)

4,990,951

6,260,573

-

(2,708,203)

655,159

(2,053,044)

-

-

4,207,529

(1,989,054)

-

7,120,599

1,129,028

8,249,627

-

-

6,260,573

48,140,795

3,114,693

(2,708,203)

655,159

1,061,649

-

(3,900,000)

45,302,444

40,634,829

3,006,339

7,120,599

1,129,028

11,255,966

-

(3,750,000)

48,140,795

CASH FLOWS FROM OPERATING ACTIVITIES:Net income before income tax

Adjustment for:

Depreciation & amortization expenses

Doubtful debts provision

Provision for staff end - service indemnity

Change in fair value for trading investment

Real estate investment return

(Gain) losses from the sale of investment available for sale - net


Unearned premiums provision - net

Outstanding claims provision - net

Mathematical provision - net

Various technical provision - net

Net Income Before Changes in Working Capital(Increase) Decrease in Current Assets:Cheques under collection and notes receivable

Accounts receivable

Insurance companies accounts - debit

Trading investments

Other assets

Increase (Decrease) in Current Liabilities:Accounts payable

Insurance companies accounts - credit

Various provision

Other liabilities

Net Cash Flows from Operating Activities Before TaxIncome tax paid

Staff end-of-service indemnity paid

Amount paid from the scientific research and technical training fund reserve

Board of Directors' remuneration paid

Net Cash Flows from Operating Activities

CASH FLOWS FROM INVESTING ACTIVITIES:Deposits at banks

Investments available for sale

Investments held to maturity

Loans of the life department

Fixed assets - net

Property investments - net

Collected from sale property investments

Disposed assets

Disposed liabilities

Net Cash Flows (Used in) Investing Activities

CASH FLOWS FROM FINANCING ACTIVITIES:Due to bank

Dividends paid

Net Cash Flows (Used in) Financing ActivitiesNet increase (decrease) in cash

Cash on hand and at banks - beginning of the year

Cash On Hand And At Banks - End of the Year

Cash Flow Statement

29

3,919,615

229,273

166,983

111,888

(178,215)

(1,045)

(187,763)

1,129,028

102,490

314,622

(91,214)

145,000

5,660,662

70,524

475,038

(1,338,192)

278,103

(206,578)

1,720,335

184,009

(68,741)

105,895

6,881,055 (1,605,699)

(59,175)

(133,182)

(55,000)

5,027,999

78,110

(2,758,837)

272,439

(7,527)

(145,000)

(6,210,282)

157,202

2,412,124

(2,418,671)

(8,620,442)

-

(3,697,998)

(3,697,998) (7,290,441)

11,143,492

3,853,051

3,321,029

216,904

154,345

86,059

3,302

(1,801,611)

1,555,486

655,159

(87,615)

1,543,851

41,997

-

5,864,136

(96,892)

(1,612,145)

82,680

-

40,543

(1,667,997)

837,322

1,796

87,401

3,536,844 (1,088,597)

(7,902)

(47,913)

(55,000)

2,337,432

(17,622)

4,940,751

1,000,000

(7,789)

(536,821)

(5,720,494)

2,139,570

-

-

1,797,595

419,458

(3,926,352)

(3,506,894) 628,133

3,853,051

4,481,184

Note

NumberJD JD






DescriptionWritten PremiumsDirect insurance

Facultative reinsurance accepted

Local reinsurance share

Foreign reinsurance share

Net Written PremiumsOpening BalanceUnearned premium provision

Deduct: reinsurance share

Net Unearned Premium ProvisionEnding BalanceUnearned premium provision


Net Unearned Premium ProvisionChange in Unexpired Risks ProvisionNet Earned Premium IncomeClaims paid

Salvage and subrogation



Net Claims PaidClosing Outstanding Claims ProvisionReported

IBNR


Net Outstanding Claims ProvisionOpening Outstanding Claims ProvisionReported

IBNR


Net Outstanding Claims ProvisionChange in Outstanding ProvisionCost of Claims IncurredNet Earned Premium IncomeCost of Claims IncurredAddCommissions received

Issuing fees

Other revenues

Total RevenuesDeductCommissions paid



Other expenses

Total Expenses

Underwriting Profit (Loss)

2009

Underwriting Profit (Loss) Account for

the Motor Department for the Period Ended 31st December

12,940,491

1,279,321

425,723

34,992

13,759,097

6,247,879

188,897

6,058,982

6,287,720

224,308

6,063,412

-4,430

13,754,667

11,025,142

2,723,628

100,017

-20,907

8,222,404

4,532,750

137,040

195,848

4,473,942

4,423,606

132,473

183,421

4,372,658

101,284

8,323,688

13,754,667

8,323,688

8,940

95,068

239,120

5,774,107

423,930

201,183

2,204,807

280,618

3,110,538

2,663,569

5,018,478

-

-

34,992

4,983,486

2,843,662

30,056

2,813,606

2,518,253

22,922

2,495,331

318,275

5,301,761

3,982,015

1,070,106

-

-14,431

2,926,340

1,416,166

48,772

62,553

1,402,385

1,592,732

43,804

37,000

1,599,536

-197,151

2,729,189

5,301,761

2,729,189

8,940

12,137

-4,169

2,589,480

260,199

72,868

972,022

-

1,305,089

1,284,391

7,922,013

1,279,321

425,723

-

8,775,611

3,404,217

158,841

3,245,376

3,769,467

201,386

3,568,081

-322,705

8,452,906

7,043,127

1,653,522

100,017

-6,476

5,296,064

3,116,584

88,268

133,295

3,071,557

2,830,874

88,669

146,421

2,773,122

298,435

5,594,499

8,452,906

5,594,499

-

82,931

243,289

3,184,627

163,731

128,315

1,232,785

280,618

1,805,449

1,379,178

11,571,070

2,750,872

322,566

12,136

13,987,240

6,287,720

224,308

6,063,412

6,101,782

155,766

5,946,016

122,396

14,109,636

10,036,260

2,160,907

61,910

14,650

7,798,793

6,036,620

129,980

239,492

5,927,108

4,532,749

137,040

195,848

4,473,941

1,453,167

9,251,960

14,109,636

9,251,960

2,221

113,280

222,461

5,190,638

463,454

222,705

2,118,914

248,235

3,053,308

2,137,330

4,183,379

-

-

12,136

4,171,243

2,518,253

22,922

2,495,331

2,150,187

4,695

2,145,492

349,839

4,521,082

2,858,542

809,398

1,295

-

2,047,849

1,230,814

34,131

104,570

1,160,375

1,416,165

48,772

62,553

1,402,384

-242,010

1,805,840

4,521,082

1,805,840

2,221

18,380

-

2,735,843

212,586

66,415

848,905

-

1,127,906

1,607,937

7,387,691

2,750,872

322,566

-

9,815,997

3,769,467

201,386

3,568,081

3,951,595

151,071

3,800,524

-232,443

9,583,554

7,177,718

1,351,509

60,615

14,650

5,750,944

4,805,806

95,849

134,922

4,766,733

3,116,584

88,268

133,295

3,071,557

1,695,176

7,446,120

9,583,554

7,446,120

-

94,900

222,461

2,454,795

250,868

156,290

1,270,009

248,235

1,925,402

529,393



Amman - Jordan Financial Statements

30“These statements are selective extracts from the English Financial Statement and should be read together with it.”

JDTotal

JDAbroad

JDJordan

2010

JDTotal

JDAbroad

JDJordan


the Marine Department for the Period Ended 31st December














IBNR



IBNR



Issuing fees

Other revenues




Other expenses

Total Expenses


2,834,232

82,853

60,662

2,446,763

409,660

536,777

377,677

159,100

474,914

389,589

85,325

73,775

483,435

2,742,158

32,909

655,624

1,852,178

201,447

1,779,188

3,346

1,529,867

252,667

1,615,536

2,951

1,343,459

275,028

-22,361

179,086

483,435

179,086

593,137

20,424

87,760

1,005,670

112,412

30,000

292,937

12,230

447,579

558,091

970,227

-

-

830,019

140,208

156,704

92,041

64,663

98,576

69,781

28,795

35,868

176,076

697,998

666

-

581,726

115,606

66,428

1,915

46,495

21,848

689,429

722

573,829

116,322

-94,474

21,132

176,076

21,132

194,908

952

-2,155

348,649

74,697

10,268

99,829

-

184,794

163,855

1,864,005

82,853

60,662

1,616,744

269,452

380,073

285,636

94,437

376,338

319,808

56,530

37,907

307,359

2,044,160

32,243

655,624

1,270,452

85,841

1,712,760

1,431

1,483,372

230,819

926,107

2,229

769,630

158,706

72,113

157,954

307,359

157,954

398,229

19,472

89,915

657,021

37,715

19,732

193,108

12,230

262,785

394,236

2,489,154

369,184

301,357

2,147,584

409,397

474,914

389,589

85,325

570,791

474,709

96,082

-10,758

398,639

479,995

57,080

11,866

322,502

88,547

1,688,826

1,476

1,446,232

244,070

1,779,188

3,346

1,529,867

252,667

-8,596

79,951

398,639

79,951

537,189

22,287

37,733

915,897

103,529

45,000

334,737

11,133

494,399

421,498

961,476

-

-

828,342

133,134

98,576

69,781

28,795

126,132

96,737

29,395

-601

132,533

103,325

17,057

-

58,217

28,051

181,923

468

131,926

50,465

66,428

1,915

46,495

21,848

28,617

56,668

132,533

56,668

168,475

1,209

-

245,549

60,916

14,634

125,548

-

201,098

44,451

1,527,678

369,184

301,357

1,319,242

276,263

376,338

319,808

56,530

444,659

377,972

66,687

-10,157

266,106

376,670

40,023

11,866

264,285

60,496

1,506,903

1,008

1,314,306

193,605

1,712,760

1,431

1,483,372

230,819

-37,213

23,283

266,106

23,283

368,714

21,078

37,733

670,348

42,613

30,366

209,189

11,133

293,301

377,047





2009

JDTotal

JDAbroad

JDJordan

2010

JDTotal

JDAbroad

JDJordan


the Fire Department for the Period Ended 31st December














IBNR



IBNR



Issuing fees

Other revenues




Other expenses

Total Expenses


8,523,923

2,172,229

2,596,900

7,598,515

500,737

4,027,780

3,850,488

177,292

3,975,150

3,786,694

188,456

-11,164

489,573

2,212,941

81,827

145,167

1,780,767

205,180

9,278,288

3,012

8,796,376

484,924

3,248,280

2,473

2,988,927

261,826

223,098

428,278

489,573

428,278

1,300,136

136,078

68,640

1,566,149

155,723

85,000

783,339

56,477

1,080,539

485,610

800,353

37,753

36,259

684,645

117,202

268,728

231,108

37,620

318,777

268,053

50,724

-13,104

104,098

87,452

77,403

31,486

-31,679

10,242

93,542

140

84,472

9,210

79,693

476

67,222

12,947

-3,737

6,505

104,098

6,505

182,280

594

-3,552

276,915

68,916

17,586

74,566

-

161,068

115,847

7,723,570

2,134,476

2,560,641

6,913,870

383,535

3,759,052

3,619,380

139,672

3,656,373

3,518,641

137,732

1,940

385,475

2,125,489

4,424

113,681

1,812,446

194,938

9,184,746

2,872

8,711,904

475,714

3,168,587

1,997

2,921,705

248,879

226,835

421,773

385,475

421,773

1,117,856

135,484

72,192

1,289,234

86,807

67,414

708,773

56,477

919,471

369,763

9,137,130

2,396,083

2,608,787

8,275,282

649,144

3,975,150

3,786,694

188,456

4,606,343

4,413,739

192,604

-4,148

644,996

1,747,935

105,778

99,130

1,385,241

157,786

9,575,235

2,251

9,085,259

492,227

9,278,288

3,012

8,796,376

484,924

7,303

165,089

644,996

165,089

1,216,184

132,433

-5,448

1,823,076

197,419

85,000

939,341

59,875

1,281,635

541,441

891,180

67,182

20,330

784,442

153,590

318,777

268,053

50,724

431,377

386,902

44,475

6,249

159,839

32,037

55,917

-

-31,330

7,450

258,163

124

232,020

26,267

93,542

140

84,472

9,210

17,057

24,507

159,839

24,507

199,057

710

-

335,099

103,381

14,654

124,872

-

242,907

92,192

8,245,950

2,328,901

2,588,457

7,490,840

495,554

3,656,373

3,518,641

137,732

4,174,966

4,026,837

148,129

-10,397

485,157

1,715,898

49,861

99,130

1,416,571

150,336

9,317,072

2,127

8,853,239

465,960

9,184,746

2,872

8,711,904

475,714

-9,754

140,582

485,157

140,582

1,017,127

131,723

-5,448

1,487,977

94,038

70,346

814,469

59,875

1,038,728

449,249





2009

JDTotal

JDAbroad

JDJordan

2010

JDTotal

JDAbroad

JDJordan


the Liability Department for the Period Ended 31st December














IBNR



IBNR



Issuing fees



Other expenses

Total Expenses


1,446,869

109,880

111,347

1,415,478

29,924

979,348

966,364

12,984

791,692

776,889

14,803

-1,819

28,105

38,110

18,257

-

14,326

5,527

648,313

92

599,895

48,510

208,944

60

167,540

41,464

7,046

12,573

28,105

12,573

176,485

13,503

205,520

6,582

159,724

3,573

169,879

35,641

44,999

-

-

35,398

9,601

25,610

20,622

4,988

20,390

15,700

4,690

298

9,899

-

-

-

-

-

2,400

-

2,160

240

2,400

-

2,160

240

-

-

9,899

-

13,367

185

23,451

5,999

4,814

-

10,813

12,638

1,401,870

109,880

111,347

1,380,080

20,323

953,738

945,742

7,996

771,302

761,189

10,113

-2,117

18,206

38,110

18,257

-

14,326

5,527

645,913

92

597,735

48,270

206,544

60

165,380

41,224

7,046

12,573

18,206

12,573

163,118

13,318

182,069

583

154,910

3,573

159,066

23,003

1,579,230

52,563

53,110

1,544,661

34,022

791,692

776,889

14,803

835,692

819,384

16,308

-1,505

32,517

51,617

2,008

145

37,017

12,447

732,633

207

659,456

73,384

648,313

92

599,895

48,510

24,874

37,321

32,517

37,321

252,499

16,265

263,960

7,623

164,452

3,349

175,424

88,536

53,513

-

-

40,268

13,245

20,390

15,700

4,690

25,331

19,092

6,239

-1,549

11,696

-

-

-

-

-

-

-

-

-

2,400

-

2,160

240

-240

-240

11,696

-240

15,659

236

27,831

6,934

5,188

-

12,122

15,709

1,525,717

52,563

53,110

1,504,393

20,777

771,302

761,189

10,113

810,361

800,292

10,069

44

20,821

51,617

2,008

145

37,017

12,447

732,633

207

659,456

73,384

645,913

92

597,735

48,270

25,114

37,561

20,821

37,561

236,840

16,029

236,129

689

159,264

3,349

163,302

72,827





2009

JDTotal

JDAbroad

JDJordan

2010

JDTotal

JDAbroad

JDJordan

Underwriting Profit (Loss) Account for the

Other Classes Department for the Period Ended 31st December














IBNR



IBNR



Issuing fees



Other expenses

Total Expenses


236,007

-

1,609

39,086

195,312

107,165

19,049

88,116

97,151

13,405

83,746

4,370

199,682

21,944

-

-

-

21,944

279,202

366

189,493

90,075

189,405

455

115,492

74,368

15,707

37,651

199,682

37,651

12,839

1,296

176,166

14,037

31,174

5,261

50,472

125,694

170,602

-

-

5,217

165,385

91,539

11,037

80,502

76,461

2,173

74,288

6,214

171,599

21,944

-

-

-

21,944

39,966

366

-

40,332

45,324

375

-

45,699

-5,367

16,577

171,599

16,577

2,087

157

157,266

12,383

24,479

-

36,862

120,404

65,405

-

1,609

33,869

29,927

15,626

8,012

7,614

20,690

11,232

9,458

-1,844

28,083

-

-

-

-

-

239,236

-

189,493

49,743

144,081

80

115,492

28,669

21,074

21,074

28,083

21,074

10,752

1,139

18,900

1,654

6,695

5,261

13,610

5,290

247,715

-

-

38,255

209,460

97,151

13,405

83,746

103,089

15,973

87,116

-3,370

206,090

206,609

-

-

137,381

69,228

161,173

1,154

103,931

58,396

279,202

366

189,493

90,075

-31,679

37,549

206,090

37,549

12,656

1,161

182,358

16,159

33,713

5,092

54,964

127,394

184,178

-

-

6,312

177,866

76,461

2,173

74,288

83,106

4,295

78,811

-4,523

173,343

35,275

-

-

-

35,275

30,850

588

-

31,438

39,966

366

-

40,332

-8,894

26,381

173,343

26,381

2,524

152

149,638

13,992

27,353

-

41,345

108,293

63,537

-

-

31,943

31,594

20,690

11,232

9,458

19,983

11,678

8,305

1,153

32,747

171,334

-

-

137,381

33,953

130,323

566

103,931

26,958

239,236

-

189,493

49,743

-22,785

11,168

32,747

11,168

10,132

1,009

32,720

2,167

6,360

5,092

13,619

19,101





2009

JDTotal

JDAbroad

JDJordan

2010

JDTotal

JDAbroad

JDJordan


the Medical Department for the Period Ended 31st December












IBNR



IBNR



Issuing fees

Other revenues



Other expenses

Total Expenses


3,952,186

121,531

-

1,845,216

2,228,501

519,840

243,124

276,716

828,236

388,298

439,938

-163,222

2,065,279

2,699,656

-

1,545,950

1,153,706

128,314

242,477

200,225

170,566

206,403

436,676

418,001

225,078

-54,512

1,099,194

2,065,279

1,099,194

60,303

85,287

19,306

1,130,981

94,249

422,390

313,069

829,708

301,273

72,145

-

-

44,882

27,263

54,152

43,383

10,769

28,313

23,674

4,639

6,130

33,393

51,406

-

41,133

10,273

-

-

-

-

-

-

-

-

-

10,273

33,393

10,273

60,016

-

-

83,136

75

14,941

7,779

22,795

60,341

3,880,041

121,531

-

1,800,334

2,201,238

465,688

199,741

265,947

799,923

364,624

435,299

-169,352

2,031,886

2,648,250

-

1,504,817

1,143,433

128,314

242,477

200,225

170,566

206,403

436,676

418,001

225,078

-54,512

1,088,921

2,031,886

1,088,921

287

85,287

19,306

1,047,845

94,174

407,449

305,290

806,913

240,932

4,497,770

213,296

-

1,907,191

2,803,875

828,236

388,298

439,938

1,237,138

611,970

625,168

-185,230

2,618,645

2,566,411

-

1,472,100

1,094,311

128,637

273,520

208,295

193,862

128,314

242,477

200,225

170,566

23,296

1,117,607

2,618,645

1,117,607

5,362

120,879

24,405

1,651,684

132,234

738,014

393,437

1,263,685

387,999

138,948

-

-

85,910

53,038

28,313

23,674

4,639

56,157

35,619

20,538

-15,899

37,139

48,335

-

38,611

9,724

-

-

-

-

-

-

-

-

-

9,724

37,139

9,724

5,207

-

-

32,622

3,395

30,444

13,074

46,913

-14,291

4,358,822

213,296

-

1,821,281

2,750,837

799,923

364,624

435,299

1,180,981

576,351

604,630

(169,331)

2,581,506

2,518,076

-

1,433,489

1,084,587

128,637

273,520

208,295

193,862

128,314

242,477

200,225

170,566

23,296

1,107,883

2,581,506

1,107,883

155

120,879

24,405

1,619,062

128,839

707,570

380,363

1,216,772

402,290





2009

JDTotal

JDAbroad

JDJordan

2010

JDTotal

JDAbroad

JDJordan


the Life Department for the Period Ended 31st December





Net Written PremiumsOpening BalanceMathematical provision


Net Mathematical ProvisionEnding BalanceMathematical provision


Net Mathematical ProvisionChange in Mathematical ProvisionNet Earned Premium IncomeClaims paid

Maturity & surrender of policies



Net Claims PaidEnding BalanceReported


Net Outstanding Claims ProvisionOpening BalanceReported


Net Outstanding Claims ProvisionChange in outstanding provisionCost of Claims IncurredNet Earned Premium IncomeCost of Claims IncurredAddCommissions received

Issuing fees

Investment income attributable to U/W

Other revenues




Other expenses

Total ExpensesUnderwriting Profit (Loss)

JDJordan

JDJordan

2010 2009

5,000,088

1,148,423

1,035,895

3,437,642

1,674,974

1,971,185

461,383

1,509,802

1,931,003

512,415

1,418,588

91,214

1,766,188

3,763,810

236,210

80,375

2,921,825

997,820

721,908

524,884

197,024

600,677

448,013

152,664

44,360

1,042,180

1,766,188

1,042,180

77,010

261,906

180,069

-

1,242,993

105,289

-24,535

628,136

62,152

771,042

471,951

7,188,334

337,380

138,871

4,848,006

2,538,837

1,931,003

512,415

1,418,588

2,425,093

964,508

1,460,585

-1,997

2,496,840

5,735,567

102,133

96,466

4,035,261

1,705,973

1,215,857

943,346

272,511

721,908

524,884

197,024

75,487

1,781,460

2,496,840

1,781,460

217,123

76,784

158,487

4,774

1,172,548

294,664

-

512,576

67,610

874,850

297,698





1. General a. The Company was established in 1951 and is registered as a Jordanian Public Shareholding Company under Number (11) with a paid-up capital of JD100,000. On July 12, 1981, the Company’s capital was raised to JD1,100,000.

On May 1, 1988, the Company merged with General Assurance Company for the Near East (National Union) in Jordan, after the evaluation of the two companies assets. Accordingly, the Company’s capital was increased to JD5,000,000 divided into 5,000,000 shares.

The Company's capital was raised gradually with the latest increase in 2006, in which the authorized company’s capital was raised by JD10,000,000 to reach JD30,000,000 divided between 30,000,000 shares.

The Company is involved in various insurance activities and has branches in Riyadh, Jeddah, Khobar, Abu Dhabi, Sharjah, Dubai and marketing insurance policies in Kuwait through an agency.

b. The financial statements were approved by the Board of Directors on February 17, 2010 subject to the approval of the General Assembly of Shareholder.

2. Accounting Policiesa. Basis of Preparation of the Financial Statements- The attached financial statements have been prepared in accordance with the forms determined by the Insurance Regulatory Commission.

- The financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) and related interpretations at December 31, 2004 and accounting policies adopted in the last audited financial statements.

- The International Financial Reporting Standards Board (IFRSB) issued amendments to the accounting standards and new international financial standards, which have become valid effective from January 1, 2005 and issued amendments to the accounting standards and new international financial standards which have become valid effective from January 1, 2006/2007. They had not been applied until the date of the accompanying financial statements, and the financial effect from their application has not been determined yet pending the update of regulations of the regulatory authorities in this respect.

- The accompanying financial statements are stated in Jordanian Dinars.

b. Basis of Consolidation of Financial StatementsThe financial statements include the financial statements of the Company and its foreign branches. Moreover, intercom balances are eliminated.

c. Revenues, Expenses and Transactions RecognitionInsurance premiums are recognized according to the accrual basis. All commissions and other acquisition costs for new or renewed insurance policies are taken to the statement of income when incurred. All other revenues and expenses are accounted for according to the accrual basis. Cash dividends are recorded as revenue when declared and ratified by the General Assembly. Financial assets acquisition and disposal are recognized at the settlement date.

d. Reinsurance AccountsReinsurers shares of insurance premiums, paid claims,

technical provisions, and all other rights and obligations resulting from reinsurance based on contracts concluded between the company and reinsurers are accounted for according to the accrual basis.

e. Technical ProvisionsTechnical provisions are taken and maintained according to the regulations of the Insurance Regulatory Commission as follows:

1. The provision for unearned premiums for general insurance activities is calculated according to the remaining days up to the expiry date of the insurance policy on the basis of a 365-day year except for marine and land transport insurance for which the provision is calculated on the basis of underwritten premiums of valid documents at the date of the financial statements.

2. The provision for reported claims is computed by determining the total expected costs for each claim on an individual basis.

3. Additional provisions for unreported claims and catastrophic risks are calculated based on the company's experience and estimates.

4. Mathematical reserves of life insurance policies are calculated according to actuarial formulae that are periodically reviewed by an actuary.

5. Additional technical reserves are taken against any claims that may arise against the company.

f. Financial Assets Held for TradingFinancial assets held for trading are initially recognized at cost and remeasured at fair value at the date of the financial statements. Gains or losses resulting from these are taken to the statement of income when incurred.

g. Available-for-Sale Financial AssetsAvailable-for-sale financial assets are initially recognized at cost and remeasured at their fair value at the date of the financial statements. Gains or losses resulting there from are taken to shareholders’ equity. If the assets are sold, in whole or in part, or determined to be impaired, the cumulative gain or loss previously recognized in equity is included in the statement of income for the period.

h. Held-to-Maturity InvestmentsHeld-to-maturity investments, which the company intends to hold up to the maturity date, are stated at cost. Premium or

Notes to Financial Statements


discount (if any) is amortized according to the effective interest rate method by taking it to interest. Any provisions resulting from the impairment in the value of these investments leading to the recoverability of the investment or part there from are deducted.

i. Property Investments Property investments are stated at cost net of accumulated depreciation (except for lands). Moreover, depreciation is calculated on their productive lives. When the recoverable amount of the property is less than its carrying amount, the carrying amount of the property is reduced to its recoverable amount, and the impairment loss is taken to the statement of income.

j. Fixed AssetsFixed assets are stated at cost and depreciated (except for lands) according to the straight-line method at annual rates ranging from 10% to 20%.

k. Impairment of Fixed AssetsWhen the recoverable amount of a fixed asset is less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount, and the impairment loss is taken to the statement of income.

l. Provision for Doubtful DebtsA provision for doubtful debts is taken when it becomes evident to management that these debts cannot be recovered in part or in full. The provision is calculated on the basis of the difference between the book value and recoverable value.

m. Provision for Income Tax- A provision for income tax is taken on the basis of the expected tax liabilities estimated according to the regulations in force. The company’s accrued income tax differences (if any) are taken to the statement of income when paid after final settlement has been reached with the Income Tax Department.

- Deferred tax assets are taxes expected to be paid or recovered due to temporary timing differences between the value of assets or liabilities in the financial statements and the value on the basis of which tax profit is calculated. Taxes are calculated on the basis of the tax liability method in the balance sheet. Additionally, taxes are calculated, and deferred tax assets are recognized. - The balance of deferred tax assets or liabilities reviewed at the date of the financial statements. Moreover, it is reduced in case it is expected that these tax assets will not be utilized wholly or partially, tax liabilities are settled, or the related need no longer exists.

n. Provision for Staff End-of-Service IndemnityAnnual compensations paid to employees who leave office are taken to the provision for End-of-service indemnity when paid. Moreover, a provision is taken for the liabilities existing at the date of the financial statements.

o. Foreign Currency TransactionsTransactions in foreign currencies are recorded at the exchange rates of the Jordanian Dinar prevailing at the transaction date. Assets and liabilities denominated in foreign currencies are translated to Jordanian Dinar according to the average selling and buying exchange rates at the date of the financial statements. Exchange gains or losses resulting there from are taken to the statement of income.

p. Allocated General and Administrative Expenses 85% of the general and administrative expenses of the Head Office (including life) have been allocated to the various insurance departments on the basis of the earned premiums of each department in proportion to total premiums.

q. Intangible AssetsIntangible assets are recorded at cost upon acquisition, and are amortized over five years.

r. Fair ValueThe fair value of listed financial assets is based on its quoted closing price in the Amman Stock Exchange at the date of the financial statements. In case there is no quoted closing price for a financial asset, fair value is estimated by one of the following methods:- Comparing it to another financial asset with similar terms and conditions.- Using any other acceptable method.

s. EstimatesPreparation of the financial statements and application of the accounting policies require the company’s management to perform estimates and judgments that affect the amounts of the financial assets and liabilities, and disclosures relating to contingent liabilities.

These estimates and judgements also affect revenues, expenses, provisions and changes in the fair value, shown within shareholder's equity.

In particular, management is required to issue significant judgments to assess future cash flows and their timing. The above –mentioned estimates are based on several assumptions and factors with varying degrees of estimation and uncertainty. Moreover, the actual results may differ from the estimates due to charges resulting from the circumstances and situations of those estimates in the future.

Management believes that estimates within the financial statements are reasonable and their details are as follows:

Provision for accounts receivable is made according to various assumptions and bases adopted by management to evaluate the required provision according to the International Financial Reporting Standards.

The financial year is charged with its part from income tax according to the regulations and laws.

Management revaluates the productive lives of tangible assets periodically for the purposes of calculating annual depreciation based on the general condition of those assets and the estimates of their expected productive lives in the future. Any impairment loss is taken to the statement of income.

The outstanding claims provision and technical provisions are taken based on technical studies according to the instructions of the Insurance Regulatory Commission. Moreover, the mathematical reserve is taken based on actuarial studies.

Provision for lawsuits against the company is based on a legal study conducted by the company's lawyer according to which probable in future risks are determined. Review of such studies is performed periodically.

Management reviews the financial assets, shown at cost, to evaluate any impairment in their value. Such impairment is taken to the statement of income.



3. Deposits at Banks:-

4. Trading Investments:-

6. Investments Held to Maturity:-

7. Property Investments - Net:-

5. Investments Available for Sale:-

31 December

JD JDJD JDTotal Total

Deposits due from 3-12 months

Deposit due in three months

Description

Inside Jordan

Outside Jordan

Total



1,167,4402,068,5133,235,953

2,158,4082,253,5304,411,938

617,3901,110,0001,727,390

1,541,0181,143,5302,684,548

Share Listed on Amman Stock Exchange (ASE) 538,587535,285

2010 2009

Description

Inside JordanListed shares

Unlisted shares

Total Inside JordanOutside JordanListed shares

Unlisted shares

Total Outside JordanTotal

16,314,877

17,018

16,331,895

19,895,374

285,359

20,180,73336,512,628

12,837,522

21,258

12,858,780

14,089,253

308,814

14,398,06727,256,847

31 December 2010 2009JD JD




Description

Listed bonds in the financial market 1,000,000-

Description

Lands

Buildings - net

Total

8,821,949

3,281,728

12,103,677

14,119,196

3,367,016

17,486,212

8. Loans and Advances of the Life Department:-

9. Cash on Hand and at Banks:-

10. Checks Under Collection and Notes Receivable:-

11. Accounts Receivable - Net:-

12. Insurance Companies Accounts - Debit:-








Description

Loans for policy - holders less than surrender value 77,86785,656

Description

Cash on hand

Cash at banks (Current Accounts)

Total

70,276

2,256,554

2,326,830

89,833

1,706,767

1,796,600

Description

Notes receivable

Checks under collection

Total

31,535

913,059

944,594

31,535

1,009,951

1,041,486

Description

Policy - holders

Agents

Employees

Others

Deduct: provision for doubtful debts

Total

7,621,986

695,491

91,400

1,585,013

9,993,890

1,226,835

8,767,055

9,355,285

950,005

81,340

1,120,896

11,507,526

1,282,671

10,224,855

Local insurance companies

Foreign reinsurance companies

Deduct: provision for doubtful debts

Total

2,199,975

1,108,974

34,000

3,274,949

1,596,134

1,630,136

34,000

3,192,269

13. Income Taxa. Income Tax Provision:-

b. Assets / Liabilities Deferred Tax:-

14. Fixed Assets - Net:-

15. Other Assets:-

JD JDJD

AccumulatedDepreciationCost

Net BookValue

JD JDJD

AccumulatedDepreciationCost

Net BookValue

Description

Lands

Buildings

Equipment, machinery & furniture

Vehicles

Total

31 December20092010



Beginning balanceIncome tax paid

Provision for income tax

Ending Balance

1,569,165

(1,605,699)

1,041,000

1,004,466

1,004,466

(1,088,597)

229,699

145,568



DescriptionAssets Deferred TaxDoubtful debts provision

Provision for staff end-of-service indemnity

Technical provision

IBNR provision

Liabilities Deferred TaxAvailable for sale investments net profit (Outside Jordan)

190,762

3,833

96,000

80,433

371,028

51,341

201,224

7,580

96,000

89,587

394,391

-

794,843

35,535

400,000

335,139

1,565,517

213,921

46,411

3,950

-

-

50,361

-

90,000

-

-

38,138

128,138

213,921

838,432

31,585

400,000

373,277

1,643,294

-

2010 2009

JDJDJDJDJDJD

DeferredTax

Deferred Tax

EndingBalanceAdjustments

BeginningBalance

511,113373,849317,158

29,2421,231,362

- 94,524

661,568144,629900,721

511,133468,373978,726173,871

2,132,083

511,113400,255478,066161,845

1,551,279

- 103,218774,092107,303984,613

511,113503,473

1,252,158269,148

2,535,892

Refundable deposits

Prepaid expenses

Accrued revenues

Others

Total

610,155

135,116

38,950

363,136

1,147,357

668,067

156,063

-

282,684

1,106,814

31 December

16. Accumulated Mathematical Reserve - Net:-

18. Accounts Payable:-

19. Insurance Companies Accounts - Credit:-

20. Other Provisions:-







Company's share from mathematical reserve

Retained earnings - additional

Total

1,378,588

40,000

1,418,588

1,420,585

40,000

1,460,585

Policy holders

Grages & spare parts

Agents

Others

Total

1,668,467

538,696

134,233

248,632

2,590,028

266,810

249,569

167,532

238,120

922,031

Local insurance companies

Foreign reinsurance companies

Total

1,281,129

2,751,755

4,032,884

1,128,029

3,742,177

4,870,206

Scientific research and vocational training provision

Universities fees provision

Annual leaves provision

Provision for group life policies profit commission

Insurance regulatory commission fees provision

Provision for staff end-of-service indemnity

Provision for vocational and technical training fund

Total

23,908

23,908

3,278

20,637

5,129

535,176

24,005

636,041

-

16,433

3,278

20,637

14,401

613,333

-

668,082

17. Due to BankThis represents credit card payments at one of the local banks for settlement of taxes due to the income and sales tax department for the period between 1/10/2010 and 31/12/2010. The balance was settled to the bank during January 2011.

21. Other Liabilities:-

22. Cumulative Changes in Fair Value:-

23. Interest Revenue:-



Unearned revenues

Accrued expenses

Board of Directors remunerations

Premiums in advance

Car parking deposits

Life policies deposits

The Ministry of Finance deposits

Other deposits

Total

402,143

91,374

55,000

461

3,257

9,479

96,962

5,680

664,356

404,207

104,583

55,000

404

4,360

4,384

91,789

5,680

670,407

Beginning balanceChange in fair value

Net realized gains

Net change in fair value


Ending balance

(1,989,054)

7,308,362

(187,763)

7,120,599

1,129,028

6,260,573

6,260,573

(4,263,689)

1,555,486

(2,708,203)

655,159

4,207,529

Bank interest

Investment held to maturity interest

Loans interest

TotalAmount transferred to underwriting accounts / Life Department

Amount transferred to income statement

359,874

100,639

1,848

462,361211,367

250,994

68,584

143,813

575

212,972155,585

57,387




24. Income from Financial Assets and Investments - Net:-

26. Employee Expenses:-

25. Other Revenues:-



Description

Foreign exchange differences

Other

Total

182,208

629,896

812,104

25,118

466,931

492,049

Description

Salaries & bonuses

Provident fund

Company contributions to social security

Medical expenses

Employee training & developments

Travel & transportation

TotalAllocated Employee Expenses - General InsuranceUnallocated Employee Expenses

3,065,080

149,320

219,409

165,946

49,566

189,262

3,838,5833,190,254

648,329

3,204,085

137,300

215,245

169,283

48,492

238,781

4,013,1863,382,670

630,516

Dividends received

(loss) Gain from the sale of trading investments - net

Change in the fair value of trading investments


Real estate investment returns

Rental income - net

Total

891,348

187,763

178,215

(1,129,028)

1,045

337,599

466,942

785,818

(1,555,486)

(3,302)

(655,159)

1,801,611

385,734

759,216




27. Administrative and General Expenses:-

28. Earnings Per Share:-

29. Cash & Cash Equivalent:-

Rents

Stationary & publications

Advertisements

Bank interest

Electricity, heating and water

Repairs

Post & telecommunication

National agent commission / outside Jordan

Professional fees

Hospitality

Lawyer fees & expenses

Revolution expenses

Computer maintenance

Computer program licenses

Computer program service

Subscriptions

Board members transportation fees

Tenders expenses

Legal fees & expenses

Donations

Insurance expenses

Marketing expenses

Discount allowed & bad debts expenses

Others

TotalAllocated General and Administrative Expenses - General InsuranceUnallocated General and Administrative Expenses

52,988

67,720

52,462

68,570

43,061

18,690

144,184

40,700

41,020

78,811

46,016

10,440

13,636

41,919

48,019

70,414

72,600

21,135

73,783

102,801

31,004

224,845

70,978

156,092

1,591,8881,332,253

259,635

52,749

70,298

41,230

79,743

46,655

9,961

148,488

40,700

54,859

54,835

21,059

-

9,122

37,314

45,306

48,833

132,000

20,734

91,883

93,782

19,367

330,001

39,940

259,560

1,748,4191,459,077

289,342






Net income for the year after tax and fees

Weighted average of stocks

Earnings per share for the year

3,006,339

30,000,000

100/-

3,114,693

30,000,000

104/-

Cash on hand

Deposit due in three month

Cash at banks (current account)

70,276

1,526,221

2,256,554

3,853,051

89,833

2,684,584

1,706,767

4,481,184

Board of Directors

Audit Committee

Legal Consultant

Internal Auditor

General Manager

DGM Technical

Operation & Branches

DGM

Financial & Administrative

IT

AGM

Marine

Fire & General

Accidents

Reinsurance

Regional

Branches

Business

Development

Motor /

Production

Accounting

Credit Control

DGM

Life & Medical

Medical

Insurance

Life

Insurance

Accounting

Shareholders

Human

Resources

Legal Affairs

Investments

Motor / Claims

Marketing

AGM

Production & Marketing

Productions

SalesTravel

Insurance

Personal

Accidents

59th annual report - jordan insurance company · 2018. 4. 18. · 2009. loss ratio in 2010 was...

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