Middle East outlook: diversification to drive economic and insurance market growth

With respect to the insurance, robust economic development and lines of compulsory insurance have been the main drivers of industry expansion in the region in recent years. Notably, efforts by member states of the Gulf Cooperation Council (GCC) to diversify their economies away from dependency on oil production has brought substantial investment in infrastructure and tourism. This should boost demand for non-life covers, as will favourable regulatory developments. Non-life premiums in the region grew by 5.5% annually during the last decade, in nominal terms.

Insurance market growth in the Middle East and Pakistan

On the life side, an expanding expatriate population in GCC member states, rising employment and
high interest rates should support market growth. Overall insurance penetration across
the Middle East and Pakistan remains low, signalling scope for further growth and also
opportunity for the industry to help strengthen economic resilience across the region.

Our latest report includes a section on natural catastrophes in the Middle East and Pakistan region. Ongoing economic development and rapid urbanisation will result in further accumulation of infrastructure and private assets that need to be insured, including against natural peril risks. Many countries in the region have a desert climate- However, “wet” weather catastrophe events like floods and cyclones are not unheard of, the recent floods in the UAE and Oman being a case in point. ¹

Natural hazards impacting the Middle East and Pakistan region

The full executive summary of this report is available to download. For the full study please contact Lukas Müller.