Insurers and reinsurers operating in the Middle East are well-capitalised, although fiscal budget pressures and political instability overshadow strong balance sheets, according to a recent report from A.M. Best.
Growth is expected to improve this year across the GCC states, except in Oman and Bahrain, according to a global and regional economic outlook and sector analysis of Coface, a provider of trade credit management solutions and risk information services worldwide. The GCC economies recorded a sharp slowdown in 2016 amidst public sector spending cuts, tightening liquidity, and investor uncertainty.
The Insurance Supervisory Commission (CSA) has directed insurers to conduct an external audit to evaluate the methods used in determining technical provisions. The external audit report is to be submitted to the regulator by 31 May.
The performance of the insurance market in 2016 is unlikely to be significantly different from that of 2015, according to Mr Brahim Djamel Kassali, President of the Algerian Union of Insurance and Reinsurance Companies (UAR).
Arig has turned around its operations to deliver a net profit of US$9.2 million for 2016, following a net loss of $4.4 million in 2015. Its reinsurance book and investment income both contributed to the rebound.
Insurers in Iran will prepare their financial statements to conform with International Financial Reporting Standards (IFRS), with state-owned Iran Insurance Company (IIC) leading the way.
Middle East Life Insurance, affiliated with the privately-owned Middle East Bank, has formally started operations in early February as the first standalone Iranian life insurer.
The insurance regulator, Central Insurance of Iran (CII), is expected to bar general insurers from accepting reinsurance risks from the next fiscal year beginning on 21 March 2017.
Insurers operating in Jordan posted JOD582.9 million (US$823.9 million) in written premiums in 2016, an increase of 5.8% over 2015, reported the Petra news agency citing an insurance industry bulletin.
Wafa Assurance, one of Morocco’s biggest insurers, plans to enlarge its footprint on the African continent by targeting anglophone countries.
Oman’s stock market regulator, the Capital Market Authority (CMA), is sticking to its stipulation that local insurers launch public share offers before August 2017. This means that at least seven local insurers will have to float shares on the Muscat Securities Market (MSM) before August, reported Times of Oman.
Farmers in Oman can expect coverage for their crops or stock as a committee chaired by the Capital Market Authority (CMA) is about to finalise a policy for such an insurance scheme.
New insurance licences are unlikely to be issued for a while in Palestine due to a crowded market, according to the Palestinian Insurance Federation (PIF).
Qatar Insurance Company (QIC) said its GWP jumped by 19% to QAR9.9 billion (US$2.7 billion) in 2016.
atar Finance and Business Academy (QFBA) has signed an MoU with Jordan-based Arab Insurance Institute (AII) to provide world-class insurance education and training services in Qatar.
There is a need for the creation of an independent high-level road safety committee responsible for the development of a national road safety strategy, according to the President of the Tunisian Road Traffic Association (ATPR), Mr Afif Frigui.
The Eurasia Tunnel, a mega-project linking Istanbul’s Anatolian side to its historical district on the European end, has started operations and is insured for US$650 million.
Total premiums in the Turkish insurance market hit TRY40.5 billion (US$11.1 billion) last year, an increase of 30.5% compared to the previous year, according to data from the Turkish Insurance Association. In comparison, premium growth in 2015 over 2014 was around 19%.
The UAE Insurance Authority (IA) has scheduled a meeting in March to evaluate the efficacy of new regulations related to motor insurance, according to Sultan Bin Saeed Al Mansouri, Minister of Economy.
Abu Dhabi National Insurance Company (ADNIC) has made a significant turnaround, returning to the black with a net profit of AED205 million (US$55.8 million) in 2016.
Dubai’s largest listed developer, Emaar Properties, has announced that it would recover AED1.22 billion (US$332.2 million) in an insurance claim arising from the highly publicised fire at The Address Downtown hotel on New Year’s Eve in 2015.
The Mediterranean and Gulf Insurance and Reinsurance Company - MEDGULF UAE, has secured approvals from the Health Authority-Abu Dhabi (HAAD) to expand its services to the capital emirate.
Global specialty insurer StarStone, a subsidiary of Bermuda-headquartered Enstar Group, has announced a joint-venture partnership with Malakite Underwriting Partners, a Managing General Agent (MGA) in Dubai, subject to regulatory approval.
The UAE’s updated Fire and Life Safety Code was designed to reduce the threat of major fires in high-rise buildings in the country, a risk that has prompted reinsurers to tighten terms and conditions for providing cover over residential and commercial property.
The National Health Insurance Company - Daman said it has adopted a new measure to validate residents’ eligibility for the Abu Dhabi Basic Plan, as per health insurance laws and regulations.
Union Insurance and Hansard International have teamed up to launch “Infinity”, a new saving and investment proposition.
The UAE Insurance Authority (IA) plans to issue new regulations this year to foster growth in the sector, including rules covering bancassurance and dispute resolution, said the head of the country’s insurance regulator.
Oman Insurance Company (OIC) saw its GWP grow by 11.6% y-o-y to AED3.56 billion (US$969.3 million) in 2016, while net profit remains flat at AED80.82 million. Non-life and life premiums increased by 11.3% y-o-y and 11.9% y-o-y to AED1.77 billion and AED1.79 billion, respectively.
UAE residents are willing to pay an average of 6% of their monthly income on insurance premiums against the 5% global average. One in five individuals in the UAE is willing to pay 10% on the same, according a report by Zurich International Life, Middle East.
Global
The (re)insurance sector has remained well-functioning and stable, evidenced by high capital levels, positive profitability and a persistent inflow of additional capital, according to the International Association of Insurance Supervisors’ (IAIS) 2016 Global Insurance Market Report (GIMAR).
Insurance CEOs are more concerned than those in any other sector about the combined threats to their growth prospects from over-regulation, the speed of technological change, changing customer behaviour, and competition from new entrants, according to findings from PwC’s 20th CEO Survey.
Takaful
The permanent secretariat of the National Insurance Council is preparing for a complete feasibility study on takaful in Algeria, including the legal, technical and economic aspects.
Favourable structural demand factors should help the takaful sector in Indonesia enlarge its market share within the country’s insurance industry, even though the growth of Islamic insurance in the country has now eased to be more in line with that of the overall industry, said Fitch Ratings.
The Securities Commission Malaysia (SC) has launched a five-year Islamic Fund and Wealth Management Blueprint to drive further development and growth of the country’s Islamic capital market.
Syarikat Takaful Malaysia Bhd (Takaful Malaysia) saw its operating revenue grow by 12.6% y-o-y to MYR2,013.3 million (US$452.2 million) at the end of 2016, thanks mainly to higher sales generated by both family and general takaful lines, according to its filing with the stock exchange.
ACR Capital Holdings announced that its 100% acquisitions of Asia Capital Reinsurance Malaysia (ACR Malaysia) and ACR ReTakaful Holdings Limited (ACR ReTakaful) through its wholly owned subsidiary, Asia Capital Reinsurance Group (Asia Capital Re), have been completed. ACR previously held 30% and 20% of ACR Malaysia and ACR ReTakaful, respectively.
The insurance regulator, the Insurance and Social Insurance Supervisory Authority (ACAPS), is currently drafting regulations to allow takaful operations in Morocco, said media reports. The first draft decree is expected to be ready in early March.
Doha Insurance is planning to convert its Islamic branch, Doha Takaful, into a full-fledged Shariah-compliant insurer as part of its overall restructuring in line with the expansion plans both locally and regionally.
The Saudi Arabian Monetary Authority (SAMA) has ordered insurers to ensure 100% Saudisation in several areas of operations in motor insurance by 2 July 2017, said media reports.
Abu Dhabi National Takaful has posted net profit of AED49 million (US$13.3 million) for 2016, 18% higher than in 2015. Earning per share reached AED0.49 at the end of 2016 compared to AED0.42 in 2015.
Takaful Emarat, a Dubai-based Shariah-compliant life and health takaful provider, said its net profits jumped by 47% y-o-y to AED15.0 million (US$4.1 million) in 2016.
The Emirates Institute for Banking and Financial Studies (EIBFS) has partnered the Islamic Banking and Finance Institute Malaysia (IBFIM) to launch a new professional certification programme – Certificate in Islamic Banking and Finance (CIBF). The programme aims to develop qualified personnel with in-depth knowledge of Islamic banking products, services and processes, as well as the Islamic financial market and takaful operations.