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Industry Analysis Insurance In Saudi Arabia

Industry Analysis Insurance In Saudi Arabia. Strategic Marketing. Outline. Overview Market leaders Industry future and challenges Q&A References. Overview. Insurance Industry Overview.

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Industry Analysis Insurance In Saudi Arabia

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  1. Industry AnalysisInsurance In Saudi Arabia Strategic Marketing

  2. Outline • Overview • Market leaders • Industry future and challenges • Q&A • References

  3. Overview

  4. Insurance Industry Overview • The role of the insurance sector is to be a cornerstone of the Saudi financial services sector by providing reliable risk transfer mechanisms, promoting long-term savings, and being a key enabler of a healthy Saudi economy • The industry has emerged as one of the fastest growing insurance industries in GCC and across the world • Regarding the global economic crisis the insurance industry has marinated its 30-35% annual growth rate • The first Saudi Arabian legislation regulating insurance was enacted in 2003 • The regulator is the Saudi Arabian Monetary Agency (SAMA)

  5. Regulatory Environment • Co-operative Insurance Regulations • Foreign Ownership • Management and finances • Board members, senior managers, mergers and takeovers of insurance companies must be approved by SAMA. • Any change of ownership in shares exceeding 5% must be notified to SAMA. • SAMA has the right to set minimum and maximum limits of cover and of premiums • Retention of risk must not be below 30%

  6. Industry Growth Gross Written Premiums 2006-2010

  7. Industry Drivers • Low Penetration (total insurance premiums to gross domestic product) • Insurance Density (total insurance premiums to total population) • The number of companies is increasing • Strong government spending • Economic diversification are likely to increase the number of persons opting for insurance plans

  8. Market Leaders

  9. It was the steppingstone to create a viable insurance industry in Saudi Arabia • Providing all types of insurance • invested heavily in the development of professional Saudi insurance employees • Contributed to the education and awareness of the society in regards to insurance • Developed new strategies and business plans concentrate on improvements in customer service, new products, and internal working environment

  10. Market Share for 2011 Others Companies • Long experience • New products • Customer satisfaction • Work environment • International Experience • Specialized in healthcare • Long experience • Tailor-maid solutions

  11. Market Share for 2010 Others Companies

  12. Strategic Group For Insurance Industry Low Malath Service & Credibility ACIG High High Low Extend of Products

  13. Industry Future and Challenges

  14. Industry Future • Takaful, Islamic insurance will be the fastest growing segments in the insurance industry in Saudi Arabia and expected to reach 12 billions in 2015 • The share of gross health insurance is likely to reach around 60% by 2015 • Non-life penetration will rise from 0.98% in 2010 to 1.25% by 2015 • General insurance sector is expected to grow around 13% from 2011-2015

  15. Challenges • Issues with Islamic finance • increasing levels of competition • Lack of awareness • No official organization • No specialized human resources • Moral Hazards and Frauds • Too many parties involved in the process • Official organization (SAMA) • Insurance companies • Service providers • Customers (insured)

  16. Q&A

  17. References • http://www.sama.gov.sa/sites/SAMAEN/Insurance/Pages/AboutISD.aspx • http://www.ameinfo.com/198489.html • http://www.zawya.com/arabic/story.cfm/sidZAWYA20111113104943/ • “Saudi Arabia Insurance Market Analysis”, Research report by RNCOS • http://www.argaam.com/article/articledetail/253804

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