The insurance markets in the GCC are witnessing profound transformation in various aspects of their operations, with growth expected to continue in the current year, propelled by several favourable factors, participants of the 20th Gulf Insurance Forum in Dubai were told.
Opening the Gulf Insurance Forum in Dubai yesterday, Mr Khalid Mohammed Al Badi, who is the chairman of both the Gulf Insurance Federation and the Emirates Insurance Federation, said that the insurance sector is witnessing a radical transformation in the economic, environmental, and technological spheres, especially in the field of risk management. “This requires reconsidering prevailing concepts and the importance of anticipating ways to enhance the role of the reinsurance industry in a world characterised by complexity, starting with digital transformation and extending to the repercussions of climate change and including new regulatory regulations.”
Growth in the GCC market
All indicators show that the GCC insurance market has achieved significant growth in the current year to date, driven by strong economic growth in GCC states, rapid digitisation, the adoption of artificial intelligence, predictive analytics, risk assessment and improved underwriting, Mr Al Badi added. “This is in addition to the expansion of mandatory insurance programmes and increased awareness of the importance of insurance among individuals and institutions, especially after the COVID-19 pandemic and the floods and heavy rains in some countries in the region.”
He added that GCC insurers will not be insulated from developments in the global insurance market, and all indications point to these companies increasing their investments in automation and digital platforms to meet changing market needs. “We expect that economic growth, population growth in the GCC countries, and the expansion of mandatory insurance programmes will lead to increased demand for insurance in the coming period.”
On mergers and acquisitions, Mr Al Badi said, "One of the important indicators in the Gulf insurance market is the recent M&A activity we have witnessed in several GCC countries. M&As are being concentrated in major companies capable of sustainability and development. This will contribute to improving the sector's position and credit rating, with strong indicators that the M&A trend in the Gulf insurance sector will continue in the coming period, which will lead to strengthening the position of large groups and companies in the market."
The UAE insurance market
Regarding the state of the UAE insurance sector, Mr Al Badi confirmed that the market is undergoing a significant correctional period, with insurance companies in the country achieving significant growth during 2024 and 2025. “This growth is driven by improved macroeconomic conditions in the UAE, the continued development of large-scale infrastructure projects, and the expansion of compulsory insurance to all emirates, in addition to other indicators, including the implementation of the unemployment system.”
He expects the sector to continue to invest significantly in automation and digital platforms, as well as the use of artificial intelligence. “This will lead to the introduction of more innovative insurance products and attract more individuals to insurance across all sectors,” he said.
He observed that the insurance sector in the UAE demonstrated great strength and efficiency following the heavy April 2024 rainfalls, the likes of which the country had not seen in 75 years. He added that despite the significant insured losses, insurers operating in the country paid all claims arising from the disaster. “These developments, among others, prompted corrective measures in light of rising reinsurance costs. This prompted companies to increase their prices for direct transactions and withdraw mandatory car insurance premium discounts.”
He also stated that insurers are enhancing their technical performance and moving away from the policy of price burning. He expects the sector to achieve growth of between 10% and 20% during 2025.
Held under the theme “Navigating Change: Shaping the Future of Reinsurance in a Dynamic Global Landscape”, the two-day Forum has attracted more than 250 CEOs, insurance executives, experts, and managers from over 30 countries, including the GCC states and numerous Arab and foreign countries, in addition to Arab and Afro-Asian insurance federations and regional and international reinsurance companies.