UAE: Insurance market to grow by 10% to $13 bln in 2017
Source: Middle East Insurance Review | Apr 2017
The UAE insurance industry is forecast to grow by around 10% this year to AED48 billion (US$13.1 billion) from AED44 billion last year, according to experts.
Two government decisions are seen as driving the projected growth. The first is the implementation of compulsory medical insurance for those with residence permits issued by Dubai, including members of families of employees, household helpers and others.
The other decision is the re-definition of the scope of auto insurance rates by the UAE Insurance Authority. This includes a schedule of premiums for vehicle insurance raising the minimum prices of auto insurance policies that took effect on 1 January this year, to provide additional benefits for policyholders, including higher compensation amounts, reported Al Bayan.
The regulator has also put in place mechanisms to prevent drastic price wars. The premium schedule sets out the minimum and maximum premiums for motor insurance, and insurers have the freedom to compete within the range.
Mr Fareed Lutfi, Secretary General of the Emirates Insurance Association, said 2017 will see a remarkable growth in gross premiums following the implementation of the unified motor insurance policy and accompanying price increases.
He also said that health insurance now ranks top among all classes of business by premiums written, contributing more than 40% of total premiums, followed by motor insurance and insurance on buildings.
The government decisions have been reflected in the annual results of insurers last year and further increases in profits will appear in the quarterly and mid-term results in 2017, other experts said.
AED1 = US$0.27