Saudi Arabia: The second-fastest growing insurance market in the GCC
Monday, 04 27 2015, Category: Insurance and Reinsurance, Country: Saudi Arabia
Saudi Arabia’s insurance market is the second-fastest growing in the Gulf Cooperation Council (GCC) and has good potential for further gains due to its low insurance penetration levels and improved profitability, according to Moody’s Investors Service. Results in 2014 showed a rebound with Saudi Arabia’s 37 listed insurance companies reporting an overall combined profit of over 0.7 billion riyal ($0.2 billion) in 2014, compared to a loss of over 1.4 billion riyals (Dh1.37 billion, $0.38 billion) in 2013. Saudi Arabia’s insurance market had premiums worth $8.1 billion in 2014, the second biggest in the GCC. Saudi Arabia was also the GCC’s second-fastest growing insurance market in 2014, with an eight-year Compound Annual Growth Rate (CAGR) of 20.3 per cent. The kingdom’s insurance premiums grew by more than 20 per cent in 2014, helped by premium rate increases in the medical and motor sectors. However, Saudi Arabia’s insurance penetration levels (1.1 per cent) are still significantly below those of most advanced economies. “Despite this significant growth, Saudi Arabia has the lowest insurance density in the GCC and one of the region’s lowest penetration levels. This suggests that there is a high degree of untapped potential in the market,” said Mohammad Ali Londe, Moody’s insurance sector analyst.
Source: Al Jazirah