GCC Ins market at $44 billion in 2021
Friday, 12 15 2017, Category: Insurance and Reinsurance, Country: Gulf Cooperation Council
Alpen Capital, an investment banking advisory firm, announced the publication of its report on the GCC Insurance Industry. The report showcases the current state of the insurance industry across the GCC nations while presenting the recent trends, growth drivers and challenges. The report also provides an outlook of the industry until 2021. It profiles some of the prominent insurance providers in the region while evaluating their financial and market valuation metrics.
The GCC insurance sector maintains resilient growth, given the significant penetration gap compared to the advanced economies and despite challenges such as drop in oil prices and reduced, public and business spending. Nevertheless, developing regulations, economic diversification efforts, mandatory health insurance and favorable demography present a bright outlook for the sector. The GCC Insurance industry is stepping into the next phase of growth, fueled by rising insurance awareness, economic revival and infrastructure developments and an expanding consumer base. Further, the maturing and stringent regulatory environment is likely to create strong, stable and sustainable business models”, says Sameena Ahmad, Managing Director, Alpen Capital (ME) Limited
“The GCC insurance sector has started showing signs of consolidation following the strengthening regulatory landscape. The trend is gathering momentum due to stringent reserving and solvency requirements in some countries. The M&A activity in the GCC insurance sector has picked up in the last couple of years, as companies are looking for strategic expansion or mergers to form stronger entities. In addition to intraregional deals, the region witnessed several cross-border acquisitions, wherein overseas insurers acquired stakes in local companies to penetrate the market. Regional players also made a few strategic investments in foreign companies to diversify geographic presence”, says Siraj Bhavnagarwalla, Managing Director, Alpen Capital (ME) Limited
According to Alpen Capital, the GCC insurance market is projected to grow at a CAGR of 10.9% from US$ 26.2 billion in 2016 to US$ 44.0 billion in 2021. This projection is based on existing fundamentals of the industry and economic outlook.