The Saudi insurance market

Photo credit: US Gov / CIA World Factbook

Insurance market features

  • Regulatory body: Ministry of Commerce
  • Premiums written (2001): 992 millions  USD (Non life: 979 / Life: 13)
  • Insurance desity (2001): 42 USD (Non life: 41.5 USD/ Life: 0.5 USD)
  • Insurance penetration rate (2001): 0.41%

Main insurance companies

  • National Company for Coooperative Insurance
  • Al Alamiya Insurance Company
  • Islamic Takaful and Retakaful Company
  • Saudi General Insurance
  • Norwich Union Insurance
  • Gulf Union Insurance
  • UCA Insurance
  • Saudi National Insurance co

Identity

  • Area: 1 960 582 Km²
  • Population (est. 2002): 23,513,000
  • GDP (est. 2002):  242 billion USD
  • GDP par capita (est. 2002): 10.500 USD
  • GDP growth rate in 2002: +0.6%
  • Inflation rate in 2002: +1%
  • Main activity sectors: Oil Production & refinery, petrochemicals, cement, fertilizers, plastics

Major towns

(in million of inhabitants)
  • Riad: 2.7
  • Jeddah: 1.6
  • Dammam: 1.2
  • Mecca: 1
  • Medina: 0.7
 

Saudi Insurance Sector Opens to Foreign Investors

In view of Saudi Arabia's entry into the World Trade Organization (WTO), the government approved a new law, on July 14, 2003, regulating the insurance sector in the Kingdom and opening it to foreign investors.
The new law is based on the concept of cooperative insurance, whereby the insured “are treated almost like shareholders, are entitled to a share in profits and are liable to pay more in case of unexpected losses”.
Under the law, and similarly to the banking sector, the Saudi Arabian Monetary Agency (SAMA) will supervise the insurance sector.
The law, to take effect in three months, is expected to boost the market's turnover in a substantial way, and to generate about 10 000 new jobs.

The new insurance law is the latest step in reforming the insurance sector in Saudi Arabia.

Chronology of reforms

  • September 2003:
    All companies with more than 500 expatriate workers must provide medical insurance for staff and their families
  • November 2002:
    Motor insurance becomes mandatory
  • September 2002:
    Mandatory health insurance for all expatriate employees in the Kingdom by 2005
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