COVID-19 and Distressed Insurance Companies in Oman

This study empirically examines the detrimental effects of COVID-19 on the already distressed insurance companies in Oman and the bankruptcy risk associated with the pandemic during 2019–2020. Altman's updated Z-score model provided the ratio analysis of the 10 largest insurance companies listed on the Muscat Securities Market and predicted any probability of financial distress in their pre-and post-pandemic experience. The model focused specifically on evaluating the effect of the pandemic on the earning power, liquidity, changes in the market value, and leverage of insurance companies. Our findings revealed that 90% of the listed insurance companies were already under financial stress before the outbreak of COVID-19 and their position did not significantly improve during the first year of the pandemic.