Insurance companies in the UAE are set to achieve profits of up to AED1.5 billion (US$408 million) for this year, an increase of more than 30% over the AED1.15 billion of profits posted last year by the 29 listed insurers in the country.
This forecast was made by Mr Essam Kassabia, a financial analyst at Menacorp Financial Services.
The expected profit trend will follow the 27.2% jump to AED766 million in net gains reported by 28 listed insurers in the first half of this year.
Analysts say that the Dubai government's mandatory health insurance scheme, which was fully implemented by earlier this year, will generate huge revenue for the insurance sector, reported Mubasher.
Another factor driving growth is the increase of 50-70% in minimum motor insurance premiums to curb price wars.
In addition, car sales are expected to soar following the Saudi Arabian government's groundbreaking move to allow women in the Kingdom to drive, starting in the middle of next year. Saudi customers account for the largest proportion of total UAE motor customers. Mr Kassabia said that the UAE car market is witnessing unprecedented demand from the Saudis.