GCC insurance market to grow 4.3% to $36.1bn in 2024 – report

The GCC’s insurance market is forecast to grow from $29.2bn in 2019 to $36.1bn in 2024, posting a compound annual growth rate (CAGR) of 4.3 per cent, an Alpen Capital report revealed.

The non-life segment will value in at $31.4bn in 2024, constituting 86.9 per cent of the total insurance market.

Sustained economic growth, population hike and infrastructure development will underpin the insurance sector’s growth, the report said.

Regional insurance penetration is anticipated to tether between 1.8 per cent and 1.9 per cent from 2019 – 2024, lower than the global average of 6.1 per cent. However, insurance density in the region is expected to soar from $502.9 in 2019 to $555.8 in 2024, the report found.

Growth markets 

In the GCC, Kuwait is expected to grow at the fastest annualised average rate of 8.2 per cent.

Meanwhile the insurance market in the UAE and Saudi Arabia is forecast to grow at a CAGR of 4.2 per cent and 5 per cent, between 2019 and 2024, respectively.

Infrastructure development and the phased rollout of mandatory health insurance will foster the insurance sector across the UAE.

Infrastructure spending, business and tourism programmes as well as an increase in women drivers will see the kingdom’s insurance sector grow. The number of women drivers in Saudi Arabia is anticipated to grow by 3 million in 2020, the report found.

Each of the GCC countries are at different phases of introducing mandatory health insurance, the report revealed. Most of them are likely to implement the policy by next year, it added.

Sameena Ahmad, managing director, Alpen Capital, Middle East said: “The GCC insurance industry, which maintained a positive momentum over the years, witnessed a slowdown in GWP’s[gross written premium]due to sluggish economic conditions during 2016 and 2018.

“However, going forward, we anticipate the GCC insurance sector to grow at a moderate pace owing to economic revival, growing population, strengthening regulatory reforms and continued implementation of mandatory insurance coverage. Infrastructure development, in line with upcoming mega events, are expected to further aid growth in the segment.”