The pandemic could spell an opportunity for regional and local insurers to step in and step up.
If risk managers complained before the pandemic that they didn’t have a seat at the table, then that’s certainly not the case now. All eyes are on them.
Crisis planning, shifting supply chains, risk evaluation, business interruption, and many other factors have all shot up in agendas as the world adapts to the new normal. Take the huge shift to working from home that has been successfully managed in many parts of the MENA region. That has created a higher exposure to cyber attacks which, in turn, is driving product development and market interest in cyber cover.
Insurance for healthcare, air travel, major construction and energy projects, P&C for empty offices, D&O cover – all of these have been shaken by COVID-19 in our region, and so present an opportunity for the insurance industry to create solutions and help get the world moving again.
Many regulators and legislators in the Middle East were already taking a proactive and nurturing approach to our industry before the pandemic, and that is likely to continue as they seek to ensure that insurance is well-placed to support the economy, and that all parties are clear on their responsibilities.
Our industry has generally adapted very well to remote working and such greater sense of a digital existence opens all sorts of new opportunities. That could mean further digitisation of a firm’s internal operations and working practices, or changes in the channels they use to talk with and engage clients. The disruption of InsurTech players will also grow and we’re likely to see new partnerships and M&A activity as companies revaluate their proposition and, in the case of asset disposals, their balance sheets.
The potential for Dubai
As the most important insurance hub in the region, Dubai faces what may prove to be a turning point. Before COVID-19, the market had taken a bit of a confidence knock with the withdrawal of some key global insurers. That left space for regional and local insurers to step in and step up, and it’s arguably more important that they do so now, because Dubai has the chance to be a stronger regional player in the coming years.
Global travel is at a near standstill and the appetite for insurance specialists to jet into the Middle East will take a long time to recover to its previous level, if indeed it ever does. So, having local representation on the ground in a stronger regional hub is going to be very compelling, as locals will be the conduit between clients and specialists. Similarly, from a market perspective, having underwriters that are regionally based and aware is important – rather than an underwriter sitting in New York or London who will not necessarily have practical experience of what is happening in the region.
Trends in diversity of talent and leadership will, I hope, be accelerated by COVID-19. We have made some great progress in the Middle East in recent times, particularly around the role of women in the industry. My hope is that the cultural changes and wider societal debates that are starting in many countries, not least in part due to the Black Lives Matter movement, will have a great and long-lasting effect in the region. Our industry has many skilled people, but we need to grow and broaden that talent base to ensure that all voices have a say. M