MANAMA: Bahrain’s insurance sector achieves 8% growth in its gross premiums over 2012 reaching BD258.41 million in 2013, according to official statistics.
The Central Bank of Bahrain which released official statistics in a statement said that the Bahrain’s motor insurance soared by 10% in 2013.
A significant part of this increase attributed to a surge in Motor insurance, which has increased from BD 61.99 million in 2012 to BD 68.05 million in 2013, showing an increase of around 10%. Motor insurance is the largest in terms of gross premiums which represented around 26% of the total premiums/contributions written in 2013.
Medical insurance has increased from BD 37.17 million in 2012 to BD 40.83 million in 2013, showing an increase of around 10% and representing almost 16% of the total premiums/ contributions written in the insurance market in 2013.
By end of 2013, Bahrain’s domestic insurance market comprised of 25 locally incorporated firms and 11 overseas insurance firms (branches of foreign companies) carrying out insurance, reinsurance, Takaful, Retakaful and Captives business in the Kingdom of Bahrain. The locally incorporated firms consisted of 14 Conventional Insurance Firms, 6 Takaful firms, 2 Reinsurance Firms, 2 Retakaful Firms and 1 Captive, while Overseas Insurance Firms consists of 8 Conventional Insurance Firms and 3 Reinsurance Firms. In addition, there are a substantial number of firms restricted to carry out business outside Bahrain and insurance ancillary services.
“The insurance sector in Bahrain holds tremendous promise for growth, as demonstrated by the industry’s strong performance not only during 2013 but also during the past five years” Abdul Rahman Al Baker, Executive Director, Financial Institutions Supervision, at the CBB, said.
“Bahrain is fast becoming a hub for major regional and international reinsurance and retakaful firms as evidenced by the number of such firms that are set up in the Kingdom,” Al Baker, added.
By end of 2013, there were five conventional Reinsurance Firms and two Retakaful Firms in Bahrain. The gross premiums/contributions of Reinsurance and Retakaful Firms reached BD 336.57 million in 2013 compared to BD 312.12 million in 2012, an increase of around 8% over the year 2012.
“We expect the insurance sector to continue its growth in the coming years, mainly due to the increase in the public awareness on the importance of the insurance products in general, as well as due to the surge in the economic growth of the Kingdom and the soundness of regulatory and supervisory framework of the insurance sector in Bahrain” Al Baker, said.
Gross premiums/contributions generated in the domestic market amounted to BD 258.41 million (US$ 685.44 million) in 2013, up from BD 239.05 million (US$ 634.08 million) in 2012.
Long-term (life and savings products) insurance generated gross premiums/contributions amounted to BD 62.77 million (US$ 166.49 million) in 2013. The long-term insurance premiums/contributions represented 24% of the total premiums written by insurance market in Bahrain in 2013.
Motor insurance constituted the single largest class of business, generating gross premiums/contributions amounted to BD 68.05 million (US$ 180.50 million) in 2013 compared to BD 61.99 million (US$ 164.43 million) in 2012, an increase of around 10%. Motor insurance accounted for 26% of the total premiums/contributions written by insurance market in Bahrain in 2013.
Fire, Property and Liability insurance premiums/contributions represented 18% of the total premiums/contributions written by insurance market in Bahrain in 2013. Fire, Property & Liability insurance premiums/contributions totaled BD 47.20 million (US$ 125.20 million) in 2013 compared to BD 41.75 million (US$ 110.74 million) in 2012, showing an increase of approximately 13%.
“Due to the well established regulatory regime, a number of leading international insurance companies established their insurance and reinsurance operations in Bahrain both in Conventional and Takaful, which has further consolidated Bahrain global profile as a financial centre. The increase of insurance ancillary services in Bahrain provides an important source of synergy to these international companies” Fouad A.Wahid Abdulla, Director, Insurance Supervision Directorate, at the CBB, said.
“The CBB continues to further enhance its regulatory framework to be in line with the best international financial standards and boost the confidence of the insurance licensees and general public” he added.