UAE – 26 insurers achieve profits in 2017
Wednesday, 02 28 2018, Category: Insurance and Reinsurance, Country: U.A.E
Spurred by regulatory reforms, the UAE insurance market sustained strong growth momentum in 2017 and returned exceptional profits, according to data released at the second Dubai World Insurance Congress, which opened on Tuesday.
In 2017, aggregate underwriting profits for UAE-listed insurers grew by an exceptional 69.8 per cent to reach Dh1.7 billion. At the same time, net profits rose 47.4 per cent to Dh1.3 billion, a special report by A.M. Best said.
Overall, listed insurers generated combined gross written premiums of Dh21.8 billion during 2017, representing a growth of 15.5 per cent from 2016. "Mandatory business lines of motor and medical insurance are the two key drivers of growth, which can be attributed to regulatory reforms," said Salman Siddiqui, analyst at Best.
"The results appear all the more impressive given the volatile economic backdrop of low oil prices and reduced government spending," said Siddiqui.
Although regulatory reforms, first introduced in 2015, led to short-term upheaval, their long-term impact has been positive. "In particular, the requirements on actuarial pricing and reserving have been critical to improvements in underwriting discipline and the resulting abatement in price-led competition. This has resulted in overall rate increases on the key business lines of medical and motor insurance, with positive consequences for premium and profit growth," said the report.