Insurance premiums reach $3bn in Qatar

Annual Insurance premiums in Qatar have reached close to $3bn. The Insurance sector now sector accounts for 1.5 percent of Qatar’s GDP. With insurance penetration lower than global average, there is immense potential for growth for insurance companies in Qatar and Mena (Middle East and North Africa) region, noted ‘MENA Insurance Pulse 2017’ report released yesterday.
“The Mena insurance markets continue to grow faster than the underlying economies,” said Dr KaiUwe Schanz, author of the study as well as Chairman and Partner at Dr Schanz, Alms & Company, speaking at a press conference held yesterday at Qatar Financial Centre.
“According to the insurance executives whom we interviewed, the region’s insurance markets strongly benefit from the continued expansion of compulsory schemes and the most recent momentum towards higher prices. Going forward, the region’s low insurance penetration, defined as premiums as a share of GDP which stand at just a quarter of the global average, is the key growth opportunity offered by the Mena markets.”
The Pulse said the insurance markets of Mena region are expected to weather the region’s continued economic slowdown and geopolitical instability. At 15 percent of total premiums, life business continues to play a minor role in $54bn Mena insurance markets, against its average global share of 56 percent, noted the study.
Around 76 percent of the senior executives polled for this annual study, believe that insurance premiums will outgrow the region’s GDP over the next 12 months.
"As in 2016, low penetration levels are the most frequently mentioned opportunity offered by MENA insurance markets. The average share of premiums in the region’s GDP is about one quarter of the global level. This gap suggests major catch-up potential given the region’s relatively high average GDP," said the study.
The study was supported by the Qatar Financial Centre, AIG, Chedid Re, Oman Insurance Company, Peak Re and Trust Re.
The respondents in the study were particularly bullish about personal lines business, which benefits from expanding compulsory insurance requirements as well as pricing support from regulatory action. In commercial lines price adequacy, especially in property business, has improved in response to more frequent fire losses although executives anticipate continued headwinds from slowing economic growth and fiscal tightening.
“The Qatar Financial Centre proudly co-presents the 5th edition of the MENA Insurance Pulse,” said Yousuf Mohamed Al Jaida, Chief Executive Officer and Board Member of the Qatar Financial Centre.