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UAE Industry Corporate Disclosures – Insurance industry in UAE
Sample section of a 15 Page Paper
Insurance industry in UAE has been in existence for the past 3 decades with some of the oldest companies such as Al Ain Ahlia Insurance Company having been introduced in 1975. At the time, UAE was a young nation trying to get to its knees in almost all the industries. In the years that followed, other companies such as Al Fujairah National Insurance Company were introduced in 1976, Al Buhaira National Insurance in 1978, and Emirates Insurance Company in 1983. These were among the oldest insurance companies with much of their focus being to cover the basic general insurance. Ever since then, new companies have been introduced in the market with the aim of targeting specific industries while at the same time advancing the insurance industry to the ever growing UAE economy.
Today in comparison to three decades ago, the UAE insurance industry has been revolutionized by being at the forefront of all the development often-adopting new legislations to harmonize the role of the agents, the institutions and further to increase stability on the role played by the insurance industry. Today, the industry relies on Federal Law No 6 of 2007 (2007 Law) which issues authority to the UAE insurance authority to governs every insurance company in UAE. Other functions played by the authority are to maintain stability by proactively creating legislations that will allow the companies in the industry to fall in line with the market changes. As of 2014, the UAE market has insurance premiums amounting to US dollars 9.12, which was a rise by 1.3% from the year 2013. The number of insurance companies is about 60 companies and 164 insurance brokers. The industry has also transformed to adopt takaful law of 2010, which allows companies to fall in line with shariah traditions (Al-Malkawi, Pillai, & Bhatti, 2014).
Review of Literate
According to El-Sayegh (2008), risk assessment and analysis plays an important factor in determining the allocation to be made. According to the article, the construction industry in UAE relies on proper analysis of factors such as the changes in prices, shortage of the labor supply, owner’s risks on unrealistic construction schedules, changes in designs and improper intervention, which may be made either by the government or by other regulating bodies. In line with all these are the disclosures that are made to reveal the changes and the transformation different sectors experience. Their findings reveal the importance of conducting allocations and more openness through disclosures to comprehend the risks that accrue to the contractors.
In an article by Aljifri (2008), the writer reviews the factors that affect disclosures in the case of a country such as UAE by using the denominator-adjusted indices. In his article, the writer notes that much of the disclosures relies on statistical calculations carried out depending on the industry. His article reveals this by using of methods such as the weighted least square method and Anova between the samples of the thirty-one listed firms that he studies. The factors that the study applies are the type of the sector, the size, debt equity, and profitability. In the study, the type of the sector was viewed to be the determining factors towards the disclosures that were made, while all the other reasons were viewed to be insignificant.
In another article, The Association between the Level of Risk Disclosure and Corporation Characteristics in the Annual Reports of Egyptian Companies by Baroma (2014) the author reviews some of the relationship issues that exists between the firms in Egypt and level of disclosure for companies listed in the market. According to the article, information about risk allows the investors to decide whether they will be in a position to bear the available challenge or whether they will be able to use other platforms such as the Insurance companies to cull the eminent risk.