The Middle East insurance market looks set to be a busy one in 2019, with three main developments standing out, the international law firm Clyde & Co has predicted.
Most of the GCC public pension schemes are on a trajectory where benefits expenditure would overtake the contributions received and eventually a point would be reached where the schemes would not have adequate resources to pay retirees, said a senior consulting actuary at Milliman Middle East and Africa.
Marine insurance experts have called for the establishment of a GCC or even a Gulf-Asian group that specialises in marine insurance and reinsurance operations, covering ships, cargo, transport of goods, oil and petrochemicals, etc.
Financial systems in the GCC have developed significantly over the last couple of decades, but there appears to be further room for progress, said the IMF.
AXA Assurance Algeria has signed a co-insurance partnership agreement with state-owned Société Algérienne d’Assurance (SAA or National Insurance), the largest insurer in Algeria, said Mr Pierre Vasserot, CEO of the Algerian unit of the French global insurer.
The 37 insurers operating in Egypt increased their combined direct premiums to EGP27.8bn ($1.6bn) in the fiscal year ended 30 June 2018 (FY2018), representing a growth of 23.6% over the previous financial year.
Regional expansion is one of the pillars of state-run Misr Insurance Holding Group’s strategy, the investment holding company’s chairman and managing director Mr Basel El Hini, has said.
Insurers have begun to amend their electronic systems in preparation for collecting a policy review fee for the Financial Regulatory Authority (FRA), amounting to one thousandth of the total direct premiums. The payments, to be made quarterly, are set to be implemented in January 2019.
All parties involved in the liability insurance of the Iranian oil tanker Sanchi that sank in January 2018 have made their compensation payments, a senior official of the Iran Insurers Syndicate has said.
The International Group (IG) of P&I Clubs has warned Club members that there is the potential for significant reinsurance shortfalls, in circumstances where a Club covers a claim with an Iranian nexus, following the re-imposition by the US of sanctions on Iran.
The organising committee of the Aqaba International Conference, AqabaConf, has announced the introduction of a new insurance award called ‘AqabaConflnsurance Research Award’ to mark 10 years since the inaugural conference was held.
Jordan’s Legislative and Opinion Bureau has published draft regulations that would establish a medical liability insurance fund.
Kuwait’s National Assembly’s legal and legislative committee has approved a draft law that would establish a mandatory health insurance scheme for expatriates living and working in the country, said media reports.
Kuwait Re has chalked up a 41% jump in underwriting results for the first nine months of 2018 to KWD2.66m ($8.8m), compared to KWD1.88m for the corresponding period a year ago. With the good performance, the combined ratio improved to 96% compared to 98% for the same period in 2017.
The Moroccan insurance sector is dealing with several new developments aimed at consolidating its financial strength and governance as well as promoting its growth, Mr Othman El Alamy, secretary general of the Insurance Supervisory Authority and Social Insurance (ACAPS) has said.
The Capital Market Authority (CMA), which oversees the insurance industry, is looking at installing an electronic system that will link insurers and private health institutions and, in turn, link these to regulatory agencies such as the Ministry of Health (MoH) and the CMA.
Lawmakers have expressed the hope that legislation will be enacted soon requiring insurers to cover natural disasters, in particular the effects of rainfall, in the aftermath of the damage to property caused by the recent heavy rainfall that hit Qatar.
The Saudi Arabian Monetary Authority (SAMA) has issued licensing and supervision rules for foreign insurers and reinsurers wishing to establish and operate a branch in the kingdom, including capital adequacy and financial suitability for obtaining a licence.
The Saudi Arabian Monetary Authority (SAMA) has released a preliminary draft concerning comprehensive insurance requirements for vehicles leased to individuals, as part of the regulator’s continual efforts to develop the financial sector and solve issues faced by customers.
Saudi Arabia’s changing regulatory landscape is expected to incentivise M&A activity and drive consolidation among smaller firms, with several deals already announced this year, said Fitch Ratings in a new special report.
The health insurance market should switch to a personalised premium calculation system that prices medical coverage according to the traits of the insured, said Mr Resit Cakas, chairman of the Insurance Agents Association (SAB).
The UAE Insurance Authority (IA) is finalising its regulatory system that will be launched soon in order to deal with online platforms that market insurance and offer insurance price comparisons.
Global insurance broker Marsh has been awarded the first licence to provide captive insurance management services in Abu Dhabi.
Etihad Credit Insurance (ECI), the UAE Federal export credit company, has signed an MoU with French bank Natixis, a subsidiary of Groupe BPCE, the second-largest banking group in France, to strengthen UAE’s exporters’ capability to trade globally, assist businesses to expand internationally and support the UAE’s non-oil diversification strategy.
HDFC International Life & Re, a subsidiary of HDFC Life, has been assigned a “BBB” rating with stable outlook by S&P.
Global
Total economic losses from natural and man-made catastrophes in 2018 declined to $155bn from $350bn in 2017, according to preliminary sigma estimates from Swiss Re. Natural catastrophes caused $146bn while man-made disasters caused $9bn of the total economic losses.
The Global Federation of Insurance Associations (GFIA) has warned that the increased supervisory mandates included in an International Association of Insurance Supervisors (IAIS) draft application paper on proactive supervision of corporate governance, would be costly to implement and overly intrusive. They could potentially even blur the line between the supervisor and the insurer, to the detriment of both, said the GFIA in a statement responding to the IAIS paper.
Alternative capital has continued its steady growth within the global reinsurance market, and Bermuda reinsurers are taking a leadership position in this business, accounting for $51.9bn or about 58% of the total capacity, according to a report by the Bermuda Monetary Authority.
With some 80% of world trade carried at sea, the maritime industry will need to transform and adapt to climate change fast to withstand its impacts, or suffer world trade risks, a UN representative has said.
Takaful
The IFSB has adopted a new standard called IFSB-20: Key Elements in the Supervisory Review Process of Takaful / Retakaful Undertakings.
The Financial Services Authority (OJK) has urged shariah insurance businesses to target millennials in order to expand the market.
The Finance Ministry has announced tax exemptions for all individual policyholders who had bought or renewed an insurance or general takaful policy for motor, fire or accident insurance during the tax holiday period from 1 June to 31 August 2018, reported The Star.
HSBC Holdings has received regulatory approval to sell its 49% stake in HSBC Amanah Takaful (Malaysia) to FWD Life Insurance Company (Bermuda) Ltd, a subsidiary of Hong Kong-based insurer FWD Ltd.
Takaful is expected to be launched in Morocco by June 2019, according to industry experts.
The Central Bank of Oman (CBO) has announced that it has become a full member of the Islamic Financial Services Board (IFSB) in an effort to further develop the Islamic banking sector in the Sultanate, reported Times of Oman.
Goldilocks Investment Company, an indirect subsidiary of Abu Dhabi Financial Group, has acquired a 29.49% stake in Takaful Emarat.
The Dubai Financial Services Authority (DFSA) has signed an MoU with Bank Negara Malaysia (BNM) to cooperate in the authorisation and supervision of banks and insurers operating in both markets.
The Islamic Insurance Association of London (IIAL) has launched a set of guiding principles covering takaful, seeking to address capacity constraints in the sector, reported Reuters.