Global economic climate re-emphasises need for better family monetary security

Research released by Friends Provident International indicates a significant 42% of the market have failed to concentrate on long term financial security for their families.

"For many UAE residents, this is their first experience with such volatile markets. These conditions provide a strong stimulus to advocate advanced savings strategies and insurance policies," said Nigel Watson, Sales and Marketing Director at Nexus.

Life insurance penetration in the UAE is low and has been estimated at under 2%, a comparatively low figure in contrast with other developing countries.

Watson added:

"Concerns such as illness cover, mortgage protection and liquid savings for emergency use are driving the need for more comprehensive life covers. Additionally, many people who originally bought term life insurance now understand the benefits of a whole of life cover that helps the owner accrue an amount of capital to provide emergency funds in the long term."

Watson believes the growing awareness among the country's residents will lead demand for more comprehensive and quality life covers.

A recent report issued by the Dubai Chamber of Commerce and Industry forecasts a 27% growth in life insurance premiums in 2009 to Dhs3.653bn.

"The need for longer term savings will be one of the drivers for the life insurance industry as people become increasingly aware of their need for personal savings, more knowledgeable about asset management and the need to seek off shore and local secure investment options," concluded Watson.