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Insurance Industry Posts 25.42pc Growth in ’08

ABU DHABI — The UAE insurance industry recorded 25.42 per cent growth last year as premiums rose to Dh18.3 billion from Dh14.59 billion in 2007, a report said on Saturday.

Highlighting the trends in insurance industry, the report said that premiums for property segment grew to Dh15.6 billion in 2008 from Dh11.9 billion a year ago, showing a growth of 31.1 per cent.

The Insurance Authority, a subsidiary of Ministry of Economy, in its report for year 2008, said that the claim ratio decreased to 57.6 per cent from 62.2 per cent a year ago. However, the total invested funds shrunk 6.4 per cent to Dh21.6 billion in 2008 as against Dh23.08 billion in 2007.

“The high growth rate and economic diversification have positively reflected on the industry,” the report said.

It said the underwriting premiums for life insurance amounted to Dh2.7 billion, with the lion’s share of 67 per cent going to foreign companies. The total premiums underwritten for property and liability were Dh15.6 billion majority of which about 77.4 per cent was bagged by local companies.

The report further said that the premium underwritten showed 53.6 per cent cover provided against accidents; 10.5 per cent against fires; 12.38 per cent to marine; 13.9 per cent to other risks; and 19.8 per cent to health.

The percentage of national insurance companies’ retention of underwriting premiums in insurance against property and liability branch 
was 50.9 per cent.

The retention percentage for each segment includes 58.7 per cent in accidents; 38.1 per cent in fire; 20.5 per cent in marine; 18.1 per cent in other risks ; and 60.6 per cent in medical.

Domestic insurance companies earned Dh14.5 billion in premiums for insurance against property and liability segment. The report put net incurred claims against property and liability branch before the deduction of re-insurance share at Dh8.3 billion.

The claims ratio for insurance against property and liability segment before the deduction of re-insurance share accounted for 57.6 per cent in 2008 as against 62.2 per cent in 2007.

The report said that the business is dominated by foreign companies as out of 56 insurance companies only 29 are registered in the country. It said five more local companies started business last year.

There are 21 insurance agents; 203 brokers; 18 consultants;70 surveyors along with 14 actuaries, the report said.

haseebhaider@khaleejtimes.com