What a challenging year 2017 has been with all that political tensions in the region! The industry carried on business as usual with salutary stoic nerves. Some companies were even reporting good returns though the risk landscape is changing rapidly with risks getting more complex and more complicated. Bravo to them – the trailblazing leaders of the region.
2017 challenged the “resilience” index of the insurance players in many ways. VAT and several bold regulatory measures forced insurers to change at a faster pace out of their comfort zones. However, technology – disruptive or complementary – has shown many up. Most companies are slow in exploiting the tech-gift, especially missing out on the region’s smart and tech-savvy millennials. But InsurTech is surely becoming a necessary buzz in the region.
The irony of the year again is the lack of consolidation in a fragmented market beset with over-capacity. We have been ringing up this possibility for all the 11 years of MEIR’s existence now. This year, many rejoiced the “regulatory gift” to the industry through the raising of insurable liabilities which pushed up rates or through compulsory classes. Read our Cover Story to uncover the mystery.
Our second Cover Story takes a leap to capture the highs of the will not just to succeed, but to excel no matter how tough the going gets. This trademark of the Middle East is so clearly seen at the 4th Middle East Insurance Industry Awards (MIIA) where 15 winners emerged from some six countries.
Our Country Profile is on Kuwait – a market that is bobbing bright but with a missing link – proper regulation. It is still coming.
On takaful, more new rules and regulations are entering the market as regulators mature through the growing years of takaful. The learning is intensive, but practical improvements are imminent.
Looking ahead, the Middle East Insurance CEO Agenda last month sounded the warning that, despite the zest by international reinsurers to have a good geographic spread and compete for business in the region, ME insurers must brace themselves to face hardening rates. How much will depend on each company’s negotiating skills and ability to package its risks. But the reality days are coming. The CEO Agenda challenged chief executives to stand up and be counted to lead their companies to make an impact on the market. “They have to be leaders and not just managers”. The chalice has been tossed. Any takers?
As it is December, let me end on a positive note.
The market is making good strides on the health front to get the highest quality of healthcare delivered with perhaps a wellness scheme being part of the underwriting model. Life business is also booming.
At the ground level, there are waves to disrupt distribution to make insurance more familiar to the buying public – individuals and corporates.
And at the visionary level, we make the call for regulators to harness behavioural science to make better intervention decisions.
Lastly, it is the month of Christmas. So I take this opportunity to wish a very Merry Christmas to our Christian readers and the very best of the countdown to the New Year to all.
Sivam Subramaniam
Editor-in-Chief
Middle East Insurance Review