Thursday 28 March 2024
 
»
 
»
Story

Ehsan Abbas and Blake Goud

Insurance outlook report launched at MEIF

MANAMA, February 18, 2016

Middle East Global Advisors, the conveners of the recently concluded 12th annual Middle East Insurance Forum (MEIF), launched a comprehensive outlook report on the final day of the event in Bahrain.

The “Finance Forward Middle East Insurance Outlook Report 2016” is a unique report that serves as indispensable guide for the insurance leader making strategic decisions for 2016, a statement said.

Ehsan Abbas, chairman of Middle East Global Advisors, said: “MEIF has served as the leading insurance platform shaping the direction of the industry and charting new ways for growth – and no doubt its successes largely stem from the unyielding support of the Central Bank of Bahrain.”

The uniqueness of the report, Abbas continued, is that it combines meaningful insights from insurance leaders - gathered from an extensive survey of practitioners’ sentiment – with robust analysis of the impact of the global economy on the Middle East’s insurance markets. The report also provides industry participants with dynamic and visual ranking of Insurance companies as compared to their peers at the regional and national level based on various financial metrics.

Blake Goud, chief research officer of Middle East Global Advisors who spearheaded the Report - shared that in 2014, growth in commercial lines grew at just 6.6 per cent (compared to 19.6 per cent for personal lines) in the Middle East (GCC and Turkey and Jordan) – with Saudi Arabia, Jordan and Bahrain enjoying significant premium growth in Personal Lines segment.

According to Goud, existing markets are not big enough to support domestic insurers at current numbers even if there is less competition from international insurers. Pointing to the industry-wide combined ratio (which in the largest markets exceed 100 per cent), Goud said that the gap is filled with net investment income, which has few low-risk investments and is too heavy on real estate.

The report also demonstrates that underwriting is very competitive in most markets and on aggregate insurers rely heavily on investment income to make up the difference.  This exposes insurers to solvency risks if their investments perform poorly.

“Bahraini and Kuwaiti insurance companies have good combined ratios and the companies elsewhere should develop their business model to move towards underwriting profitability and reduce their dependence on net investment income,” Goud concluded.

In terms of strategy, the report’s survey results show that a shift in investment portfolios in terms of deviating away from real estate investments is on the cards. In fact, approximately 38 per cent of respondents plan to decrease such investments. – TradeArabia News Service




Tags: MEGA | MEIF |

More Finance & Capital Market Stories

calendarCalendar of Events

Ads