The Impact of the COVID-19 Pandemic on Islamic Health Insurance Market Returns: Empirical Evidence from Saudi Arabia

Exciting News: Our Research on COVID-19 Impact on the Islamic Health Insurance Market

I’m thrilled to share that a research paper I co-authored with my esteemed mentor, Dr. Hakan Aslan, has just been published in the renowned Indonesian Capital Market Review, Volume 15, Number 1 (2023). The journal is indexed on WOS!

Our study, titled “The Impact of the COVID-19 Pandemic on Islamic Health Insurance Market Returns: Empirical Evidence from Saudi Arabia,” delves into the intriguing world of cooperative health insurance (CHI) in the Saudi Arabian market.

The study’s key findings are:

 We used the Event Study Methodology to examine the impact of the first COVID-19 case announcement in Saudi Arabia on March 2, 2020.

We analyzed daily price data from 24 cooperative health insurance companies listed on the Saudi Stock Market (Tadawul) alongside the market index (TASI) from June 05, 2018, to March 30, 2020.

Our results reveal a negative effect of COVID-19 on the health insurance companies in Saudi Arabia during the anticipation period leading up to the event day.

While negative abnormal returns persisted, they were statistically significant for only three days in the post-event window (March 05, 08, and 09, 2020).

This suggests that the Saudi cooperative insurance market exhibited periods of anticipation and anxiety, challenging the notion of market efficiency.

Our research not only sheds light on the initial impact of the COVID-19 pandemic but also highlights the need for further in-depth studies. These findings have implications for Islamic insurance investors, Takaful operators, regulators in Islamic insurance markets, and fellow researchers and academicians.

We’re excited about the potential insights this study can offer and look forward to future research in this fascinating field. Let’s continue to explore and understand the ever-evolving dynamics of the insurance market in the face of unprecedented challenges.

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