GCC markets see major growth across insurance and wealth management sectors in 2008

Nigel Watson, Sales Director at Nexus Group of Companies, said:

"The recent market turbulence has alerted people to take stock of and review their medium- and long-term financial goals in a number of areas."

The demand for and value of life insurance premiums in the UAE continued to rise in 2008 with a forecasted annual growth of 18% until 2011. Contributing growth factors include the rising demand for life insurance from mortgage owners keen to secure home loans and ensure protection for dependents.

For 2009, market experts anticipate continued shifts in regional investment trends with increased focus on low risk quality ventures and the spreading of individual capital funding into new opportunities and non traditional assets.

Research by Swiss Re on the UAE market indicates a major expansion in life insurance value with figures estimated to grow from $386m in 2006 to $676m by 2010. Industry analysts believe the country's growing population, extended expat residencies and maturing financial awareness will play leading roles in furthering the growing demand for life insurance premiums.

Similarly in the non life sector, the UAE's expatriate workforce have demonstrated shifts in attitude toward employment benefits with expectations expanding to include broadly-based contracts that offer group life and strictly private medical insurance coverage. With regional economies becoming more competitive, insurers and financial experts have seen sharp changes in the wider range of benefits that professional expats have automatically come to expect in their employment contracts. In an increasingly competitive market employers are having to offer a wider range of employee benefits in order to attract and retain qualified and experienced people.

Wealth management experts have highlighted another important trend in the UAE financial marketplace in 2008 as investors adopted a more risk-averse strategy. "Lately we have seen customers focus more on investment in the institution rather than just the actual fund," Watson said.

"We hear more questions such as 'How safe and secure are they?' or 'What is the credit rating of the provider?' Our independent financial advisors can offer the appropriate financial solution for more careful investors because some two-thirds of funds offered by Nexus fall in the medium- to low-risk category," Watson added.

On a final keynote for 2008, Nexus independent financial advisors also observe and encourage a return to the classic trend of pursuing more diversified investment strategies.

Watson advised customers to get serious about healthy investment diversification by divesting out of a single asset class for starters. "Don't get locked into a certain strategy focused solely or mainly on a single asset class. Financial advisors need to encourage clients to carry on investing in 2009 while share prices are low, however a diversified plan will help to safeguard capital and minimise risk," Watson said.