Shuaa wants to build extensively on the insurance portfolio it already manages. Image Credit: Shutterstock

Dubai: The Dubai fund manager Shuaa Capital expects its insurance sector linked assets under management to touch $500 million in the next three years. These sector-specific assets currently make up $136 million of the Shuaa portfolio, currently at around the $14 billion mark.

"Insurance, both conventional and takaful, is a strong recurring income segment of Shuaa's asset management business despite low margins,” said Ajit Joshi, Managing Director and Head of Public and Private Markets at Shuaa. “As such, we are focused on strategically growing our insurance assets under management.”

The insurance-linked assets represent the equity and debt portfolios of five leading insurance companies that Shuaa manages.

According to S&P Global Ratings' 2021 GCC Insurers Report, about 84 per cent of insurers in the GCC maintain capital adequacy above the 'AAA' level in their capital model, compared to about 59 per cent across EMEA. “As a result, insurers in this region continue to seek investments that have low volatility and generate stable cash income that can help them manage their assets and liabilities,” said Shuaa in a statement. “Shuaa's extensive knowledge of the insurance sector, combined with its asset management capabilities, has solidified its position as the partner of choice for insurers seeking higher and more consistent returns through diversification strategies that meet regulatory requirements.”

A 2018 move
It was in 2018 that Shuaa saw the opportunity to invest in insurance companies given the "tremendous potential of the sector".

Part of SHUAA's investment in insurance companies is through Goldilocks, an open-ended fund domiciled in ADGM and managed by the subsidiary SHUAA GMC ltd.