Abstract
The aim of this paper is to measure the efficiency of insurance companies in Saudi Arabia using data envelopment analysis (DEA), to analyse the effectiveness of underwriting processes primarily inputs and outputs are determined. Moreover, this study aims at comparing the efficiency of Takaful and cooperative in the year 2014. Taking into account two main approaches of this technique and considering a sample of 23 insurance companies, we show that the results revealed that insurance companies do not operate efficiently. Also, a classification of companies allows to discover that on average, Takaful insurance are relatively more efficient than cooperative insurance companies. The main finding of this paper is the need for better resource allocation in the cooperative insurance companies' systems, because some Takaful insurance companies have resource surplus and in other cooperative ones it is observed a lack of resources.