GCC Insurance sector expected to grow, reveals report
July 2, 2013 1:22 by kippreport
Alpen Capital released its GCC Insurance Report, which assesses the current market scenario in all GCC countries. The report estimates the insurance industry in the Gulf is projected to expand at a compounded annual growth rate (CAGR) of 18.1 per cent between 2012 and 2017 to reach a size of $37.5 billion, split between life ($2.4billion) and non-life ($35.1bn) segments.
The life insurance segment is expected to grow at an annual average rate of approximately two per cent during this period. However, the non-life segment is forecast to expand at a much higher rate of 20 per cent annually, thus increasing its share in the regional market from 86.6 per cent in 2012 to 93.6 per cent in 2017.
The insurance penetration in the GCC is expected to improve from 1.1 per cent in 2012 to two per cent in 2017, as industry growth comfortably exceeds the pace of GDP expansion. Non-life insurance penetration, which is likely to surge from nine per cent to 1.9 per cent during the period, is seen as the main driving factor.
The UAE and Saudi Arabia remain the largest insurance markets in the GCC, while Saudi Arabia may surpass the UAE as the largest insurance market in the region going forward. The Saudi insurance industry is seen as a major driver behind growth of the GCC insurance industry as it is anticipated to expand at a CAGR of 26.5 per cent between 2012 and 2017.