Dubai Insurance Co is strong on fundamentals

One of the top performers among UAE equities is Dubai Insurance Company, which has gained a handsome 74.52 per cent this year.

The Dh733 million market capitalisation company has a dividend yield of 5.49 per cent and generally pays dividends in March.

Due to the industry's very nature and the region's well-developed insurance sector, Dubai Insurance Company is rated suitable for income investors. However, markets always discount the future and many fundamentals are optimistic for the company.

Meanwhile, yields are on the rise globally which is a blessing for financial services, especially insurance. Due to the recurring nature of premiums received, insurance companies have a steady cashflow, and a significant chunk of it will have to be deployed into debt.

Dubai Insurance Company has a financial strength Rating of 'A-' (excellent) and long-term issuer credit rating of 'a' provided by AM Best. The outlook on these ratings is stable and reveals balance-sheet strength, strong operating performance, limited business profile and appropriate enterprise risk management.