June 13, 2024

UAE dominates Insurance in MENA with pioneering economic activities

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Analysis shows United Arab Emirates (UAE) insurance sector had a promising growth in 2021 with the general insurance market generating a massive revenue of  USD 2 Billion. Equity of shareholders in the United Arab Emirates – listed insurers touched AED 19.8 billion with an increase of 10.4% from AED 18 billion in the year 2020, which again had an exceptional growth with an increase of 3.9% from the year 2019.

UAE has claimed 36th  rank globally with respect to Gross Written Premium (GWP) and is the largest insurance market in the MENA region as reported in the year 2020. The largest insurance market in the MENA region has the largest market share in the Gulf Cooperation Council (GCC) with a Gross Written Premium of 43.7 % in the region. Rising activities in the nation’s corporate sector especially in investment, beneficial immigration policies and the introduction of new standards in regulation are the key contributors to the growth.

Followed by UAE, Saudi Arabia has the second largest insurance market in the Gulf Cooperation Council (GCC)  and is anticipated to grow at a Compound annual growth rate (CAGR) of 1.6% largely piloted by its tremendous infrastructure activities in acceleration towards its vision 2030 based on economic transformation.

With a share of 4.3% in 2020, Kuwait is expected to be the fastest growing insurance market at a CAGR of 5.3%, although it has a relatively smaller market in the region. Rebuilding its insurance regulation unit and investments in mega projects are the key drivers in propelling growth.

Fiddling with Success

UAE based Fidelity United, one of the leading insurance companies in the country has had a glorified 46 years of success in the insurance sector, offering a wide range of insurance services comprising Home insurance, Individual medical insurance, Motor insurance, Travel insurance, Engineering insurance, Personal accident insurance, Motor fleet insurance, Group health insurance, Liability insurance, Marine insurance, Property insurance, and SME (Small and medium-sized enterprises) products. While Fidelity United is headquartered in the Opus Tower, Dubai, it has expanded its branches in Abu Dhabi, Fujairah, Ras Al Khaimah and Sharjah.   

Having been in the market since 1976, Fidelity United is a joint venture between ‘United Insurance Company’ (Known formerly) and Lebanon based ‘Fidelity Assurance and Reinsurance SARL,’ established in November 2018. Expanding its diversified portfolio to Lebanon, Fidelity United has been introducing innovative insurance solutions commended by its millions of consumers and has enjoyed meteoric growth in recent years partly owing to its proactive risk management techniques.

Insuring Growth, Fulfilling every Oath

In March 2022, Fidelity United announced a rights issue of Dh 60 million while the last capital injection was only in 2017 with Dh 100 million. With two rounds of capital injection in four years, the UAE based company has emerged as a key player in the insurance sector.

Furthermore, Fidelity United has ranked 16th based on the analysis of gross premium in the 4th quarter of 2021. Evidently, the partnership has seen prosperous growth since the signing in 2018, the firm’s market furthered as its pet insurance plan called ‘MyBuddy Pet Insurance Plan’ has become a bright spot in the sector. It is reported that Fidelity United’s pet insurance is the most trusted and a leading pet insurance in the United Arab Emirates. The product  covers vet expenses, theft/straying, death benefit due to injuries or illness, third party liability and a one month waiting period.

Adding to its exceptional insurance products, Fidelity United’s home insurance product called Manzil has been coming up really well in the market. With just 100 AED per year, the policy covers Home contents, Accidental damage to contents, Personal Belongings, Building property, Domestic helpers, and more. Manzil pretty much covers everything in one policy.

Building on partnerships to modernize its business with technology, Fidelity United signed a strategic partnership agreement with UAE headquartered Square One Technologies to automate its insurance processes. Development of digital fluency and adopting the configuration of bots and bot runners using AI driven web services are the objectives established in the partnership. In appreciation for boosting competitiveness in the insurance sector as seen in recent years and placing the company in an advantageous position, Fidelity United has been awarded ‘Fastest Growing General Insurance Company UAE 2022’ by International Business Magazine. The title was conferred in recognition of its constant triumph in the insurance sector with its wide range of insurance products.

UAE’s insurance market is expected to have an accelerating growth at a Compound Annual Growth Rate (CAGR) of 4.1% during the forecast period of 2020 to 2026. Large scale events like Expo 2020, its booming tourism sector, and the world cup 2022 in the neighbouring Qatar are likely to further the growth. Fueled by the pandemic, insurance companies in the country have transformed their services with robust innovation strategies by adopting modern technology for a convenient consumer experience, as witnessed lately. Moreover, the government of UAE has been constantly spending on infrastructure and has an outstanding amount of financial reserves.

Blog By Harish Rajulu

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