ME conflict:Strong start to 2026 for GCC listed insurers despite regional tensions

GCC insurers entered the ongoing regional geopolitical escalation from a position of relative strength, with 1Q2026 results continuing to reflect strong premium growth and profitability across most markets, according to a report by research and consulting firm Insurance Monitor and Lux Actuaries and Consultants.

The “GCC Performance Periodical 1Q2026” states that listed insurers reported insurance revenue growth of 13.6% to $10.8bn in 1Q2026, while net profit increased by 14.7% to $714m. Performance, however, remains uneven beneath the aggregate results, with 29 out of 74 insurers reporting losses or declines in profit.

UAE underwriting recovery continues

UAE insurers registered broad-based revenue growth of 11.2% and a significant improvement in underwriting performance following repricing actions implemented after the 2024 rainfall losses. The aggregate Net Combined Ratio (NCR) improved to 90.9% (Q1 2025: 92.5%) and profitability increased by 10.0% despite a 5.5% decline in investment income, indicating improving earnings quality driven by underwriting.

Saudi Arabia shows early signs of improving underwriting performance across key lines

In Saudi Arabia, insurance revenue increased by 14.7% and net profit rose by 23.7%, supported by strong investment income growth of 10.7%. Underwriting conditions, however, remained comparatively weak, with the aggregate NCR unchanged at 98.0% and many insurers continuing to report combined ratios above 100%. Product-level analysis suggests motor pricing conditions began stabilising during late 2025, with modest improvement visible across several larger insurers in 1Q2026 as NCR fell to 103% from 105% in 1Q2025. Medical performance also improved marginally during the quarter to 93% from 95%. In contrast, P&C business reported some deterioration, potentially reflecting early pressure from inflationary and supply-chain related conditions.

Investment income continues to support GCC earnings

Outside the UAE, profitability across Oman, Bahrain, Kuwait and Qatar remained significantly supported by investment returns. Oman reported a sharp deterioration in underwriting performance, with the market NCR rising above 100%, although strong investment income growth supported a 79.0% increase in Net Profit. Kuwait reported the weakest earnings profile in the GCC, with subdued revenue growth, lower investment income and broadly flat profitability. Qatar and Bahrain continued to report strong top-line growth, although underwriting margins softened modestly during the quarter.

While the direct financial impact of the US-Iran conflict was not materially visible in 1Q2026 reported earnings, continued geopolitical tensions remain a key risk to GCC insurers through the remainder of 2026, particularly through claims inflation, supply-chain disruption and tighter reinsurance conditions.