GCC insurance industry to reach $37.5bn by 2017 as bancassurance sector prepares to pounce | GCC insurance industry to reach $37.5bn by 2017 as bancassurance sector prepares to pounce -
Jamie McNish.

GCC insurance industry to reach $37.5bn by 2017 as bancassurance sector prepares to pounce

: Thursday, February 13 - 2014 @ 11:34

Bancassurance has been tipped as one of the fastest growing distribution channels of insurance in the GCC over the next two years, as a recent report estimates the insurance industry across the six Gulf states will reach $37.5bn by 2017.

Alpen Capital’s GCC Insurance Industry report said that the regional insurance sector will expand at an annual compound growth rate of 18.7% between 2012-2017, while economic development, population expansion, and an improved regulatory environment leave the door wide open for bancassurance providers to step in and capitalise on growing opportunities.

Bancassurance – whereby insurance companies and banks collaborate to provide insurance products through a bank’s existing customer base – is still in its nascent stages in the Gulf region, which lags behind more developed economies for insurance penetration.

Though the potential is huge, challenges still remain, and regional experts will discuss the way forward at the inaugural Bancassurance MENA Summit, which takes place from 17-19 February at The Address Hotel, Dubai Mall.

DJ Sengupta, Regional Head of Insurance for Europe, Middle East and Africa at Citibank N.A, and one of leading experts at the three-day summit, said that an evolving business attitude among banks and wider acceptance of bancassurance will lead to a more mature market.

“In previous years most banks in the region were focused on lending,” said Sengupta. “Very few banks had a wealth management business, let alone insurance until a few years back.

“Citibank were the pioneers of bancassurance in the region and we’ve seen our customer base grow very steadily. Other banks are now waking up to the opportunity and have started contributing to the growth in penetration.”

Sengupta sounded a warning for the bancassurance industry, however, adding that a stronger regulatory environment was needed to discourage ‘rogue distributors’ and to improve customer loyalty. He added: “Insurance companies will have to be careful who they partner with and they will have to ensure a good control culture for the long-term growth of the industry.”

“There is an urgent need to increase the trust on insurance products and both insurance companies and banks have a leading role to play. Supported by the right regulatory environment, this can take this business to the next level.”

Creating the business case for bancassurance in the Middle East regulatory environment will be one of the major panel discussions on the opening day of the Bancassurance MENA Summit, where the region’s biggest players examine the potential growth of the burgeoning distribution channel.

“Bancassurance is practically a new concept within the Gulf region, and the potential for growth over the next five years is immense,” said Syed Adil Rehman, Head of Wealth Management at Dubai Islamic Bank, and one of four experts sitting on the panel. “The bancassurance market in the GCC is estimated to grow to $1.2bn by 2016. The key to this growth will be to offer customers a whole range of insurance solutions to suit their needs.”

Organised by IIR Middle East, the Bancassurance MENA Summit brings together leading regulators, insurers, banks, consultants and IT providers to identify market growth strategies as well as models to improve the returns and profitability of this growing channel.

The two-day conference and one-day post conference seminars are officially supported by Headline Sponsor Friends Provident International, and Silver Sponsor RSA, while other headline speakers include Ahmed Alkindi, Statistics Consultant of the UAE Insurance Authority; and Ahmad Ali Al Mamari, Acting General Manager of the Directorate of Insurance Supervision at the Capital Market Authority of Oman.

“Multiple, integrated distribution is key to the future of successful bancassurance models within the MENA region,” said Al Mamari. “Customers require the convenience of choosing which channel to adopt and this will develop as a requirement to switch between channels as part of their bank relationship. This evolution will happen over time and at different speeds of consumer adoption.”

Jamie McNish, Regional Director of Partnership Distribution, at Friends Provident International, said: “Friends Provident International is delighted to be the headline sponsor of the first Bancassurance MENA Summit. Our Bancassurance proposition forms a core part of our distribution strategy, and the summit gives us an excellent opportunity to showcase our expertise to key decision makers from the banking industry.”

Chris Dooley, Chief Executive Officer for RSA in the UAE and Bahrain, added: “The Bancassurance MENA Summit is an ideal platform bringing together leading service providers from insurance and banking to drive mutually beneficial development strategies. We look forward to meeting the delegates and to sharing our expertise and experience of this very important market segment.”

For further press information please contact:

Lindsay Johnston / Gareth Wright
Total Communications
Tel: +971 (0) 4 428 1502

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Thursday, February 13- 2014 @ 11:34 UAE local time (GMT+4) Replication or redistribution in whole or in part is expressly prohibited without the prior written consent of Mediaquest FZ LLC.

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