Bahrain ins. market being overtaken by neighbours
Saturday, 07 13 2019, Category: Insurance and Reinsurance, Country: Bahrain
Bahrain’s re/insurance market is traditionally considered one of the most advanced in the Middle East, but an industry report has revealed that it has already been overtaken by several regional peers.
The report from insurance ratings agency AM Best, titled “Bahrain’s Insurance Market’s Shine Fades, but Segment Still Prospering,” outlines that Bahrain used to have the most comprehensive and forward-looking regulatory environment in the region, but it has since stagnated due to limited innovation. Other Middle Eastern markets were able to develop risk-based regimes, outstripping Bahrain’s slightly outdated regulations.
However, the report also identified bright spots in the Bahraini market, where it thrives and remains the domicile of choice for a number of foreign operations. It noted that the takaful segment in Bahrain remains strong. Bahrain was the first Middle Eastern market to implement specific takaful regulations, and it now has the highest level of takaful penetration in the region, excluding Saudi Arabia.
The research also predicts that industry consolidation will continue, with the M&A scene seeing significant activity.
“The Bahraini market has seen a number of M&A deals in recent years, with companies looking to obtain market share through inorganic growth,” said Salman Siddiqui, director at AM Best. “While AM Best would not be surprised to see more M&A activity as companies seek to consolidate their market positions through acquisition, a number of barriers still remain.”
Source: Insurance Business