 Dubai Marina (modified picture) © Jagermesh [4], CC BY-SA 3.0 [5] |
They are much higher than those of developed countries and equal to the ones posted in major emerging countries: China and Brazil.
During the 2005 – 2012 period, total premiums in the six countries of the region have been multiplied by 3.3 times whereas world revenues increased by only 1.33. The average annual growth in all Gulf markets is about 18%. At the end of 2012, the six countries of the region reported 16.567 billion USD in premiums. Saudi Arabia and the United Arab Emirates are the main markets of the region, accounting for 77.3% of the premiums. Qatar ranks third with 7.85% of revenues, followed by Kuwait (5.85%), Oman (5.17%) and Bahrain (3.83%).
Ranking of Gulf countries per premiums: 2005-2012
in millions USD| 2005 | 2006 | 2007 | 2008 | 2009 | 2010 | 2011 | 2012 | 2012 shares | 2005-2012 evolution | |
|---|---|---|---|---|---|---|---|---|---|---|
U.A.E | 2 140 | 2 808 | 3 973 | 4 977 | 5 457 | 6 004 | 6 514 | 7 153 | 43,18% | 334% |
Saudi Arabia | 1 374 | 1 850 | 2 293 | 2 910 | 3 896 | 4 371 | 4 935 | 5 653 | 34,12% | 411% |
Qatar | 462 | 686 | 278 | 847 | 791 | 962 | 1 143 | 1 300 | 7,85% | 281% |
Kuwait | 527 | 642 | 676 | 670 | 589 | 718 | 819 | 970 | 5,85% | 184% |
Oman | 258 | 376 | 431 | 544 | 676 | 646 | 728 | 857 | 5,17% | 331% |
Bahrain | 250 | 298 | 380 | 500 | 534 | 561 | 582 | 634 | 3,83% | 254% |
Total | 5 011 | 6 670 | 8 032 | 10 448 | 11 943 | 13 262 | 14 721 | 16 567 | 100% | 330% |
A market dominated by the non-life insurance
 View of Dubai © Sebbe xy [6], CC BY-SA 3.0 [5] |
In 2012, non-life insurance accounted for 85% of the revenues, that is, 14.085 USD, whereas the life sector represents 2.482 billion USD of premiums, 65% of which were made in the United Arab Emirates.
In the two major Gulf markets, namely the United Arab Emirates and Saudi Arabia, health and motor insurance are the two main drivers of growth. In 2012, these two classes combined accounted for 64% of all premiums in both countries, whereas non life insurance (energy, engineering and other property damage) accounted for just 14% of premiums. Paradoxically, energy risks for countries listed among the biggest oil producers in the world are marginal. In Saudi Arabia, the energy premium in 2012 posted just 102 787 000 USD in premiums for a total market of 5 653 034 000 USD, that is 1.8% of revenues, while health and motor insurance together reached 75%.
Health insurance is progressing considerably
 International Medical Center, Jeddah |
The recent introduction of a compulsory health insurance for nationals and expatriates has boosted the market. In eight years (2005-2012), health insurance has become the flagship business mainly in Saudi Arabia, where its market share climbed from 26.58% in 2005 to 53.29% in 2012. In UAE, the increase was even more substantial as health insurance, set only at 6% of the portfolio in 2005, went up to 24.74% in 2012.
Statistical analysis of the last eight years shows a progression of health insurance by 1375% in the United Arab Emirates, 824% in Saudi Arabia and 727% in Bahrain. This remarkable performance is accounted for by the series of legislative reforms undertaken. Saudi Arabia has introduced compulsory health insurance for expatriates in 2006 and for nationals in 2008. It was immediately followed by most countries of the region that have aligned with the Saudi model.
Evolution of health insurance: 2005-2012
in millions USD| 2005 | 2006 | 2007 | 2008 | 2009 | 2010 | 2011 | 2012 | 2005-2012 evolution | |
|---|---|---|---|---|---|---|---|---|---|
Saudi Arabia | 365 | 592 | 819 | 1 281 | 1 944 | 2 318 | 2 589 | 3 013 | 824% |
U.A.E | 129 | 287 | 585 | 841 | 1 120 | 1 351 | 1 537 | 1 769 | 1375% |
Bahrain | 13,5 | 22,1 | 39,9 | 56,7 | 71,9 | 84,6 | 92,7 | 98,5 | 727% |
Total | 507 | 901 | 1 443 | 2 178 | 3 136 | 3 753 | 4 219 | 4 881 | 961% |
The obligation of motor insurance
 Al Khaleej Boulevard, Dubai © Imre Solt [7], CC BY-SA 3.0 [5] |
Like health insurance, the compulsory motor third party liability is at the core of premiums growth in this class of business.
The improvement of the purchasing power of the middle class, estimated at more than 60% of the total population, is the second growth factor for motor premiums in the region.
With the exception of Saudi Arabia, where it ranks only second, motor insurance remains the most underwritten risk in the Gulf countries.
Within eight years, motor turnover in the region grew by 292 % in Oman, 296% in Saudi Arabia, 209% in the UAE and 168% in Bahrain.
The motor portfolio varies from one country to another, ranging from 22.15% of the overall premiums in Saudi Arabia to 41.19% in Oman. In other countries the motor sector accounts for 25% and 30% of the portfolio.
Evolution of motor insurance: 2005-2012
in millions USD| 2005 | 2006 | 2007 | 2008 | 2009 | 2010 | 2011 | 2012 | 2005-2012 evolution | |
|---|---|---|---|---|---|---|---|---|---|
Saudi Arabia | 423 | 512 | 652 | 677 | 815 | 864 | 1 046 | 1 252 | 296% |
U.A.E | 1 041 | 1 308 | 1 694 | 2 278 | 2 129 | 2 167 | 2 164 | 2 176 | 209% |
Bahrain | 98,2 | 99,8 | 127 | 146 | 152 | 153 | 148 | 164 | 168% |
Oman | 121 | 138 1 | 168 | 234 | 299 | 271 | 299 | 353 | 292% |
Qatar 1 | - | 148 | 160 | 202 | 196 | 191 | 212 | - | - |
Total | 1 683 | 2 206 | 2 801 | 3 538 | 3 591 | 3 645 | 3 869 | 3 945 | 234% |