Bahrain’s long-term insurance sector grows 23% in first half

Total medical insurance gross premiums increased

  
General view of Bahrain World Trade Centre in Manama, Bahrain, June 20, 2019. Image used for illustrative purpose

General view of Bahrain World Trade Centre in Manama, Bahrain, June 20, 2019. Image used for illustrative purpose

REUTERS/ Hamad I Mohammed

MANAMA: Bahrain’s insurance industry has shown positive results for the six months till end-June 2021, with general insurance business (including medical insurance business) contributing 79 per cent to gross premiums.

Revealing data on the sector’s performance, the Central Bank of Bahrain (CBB) said yesterday that the growth in insurance business has been strong, with long-term covers rising 23pc and medical increasing 9pc when compared with the same period in 2021.

Total medical insurance gross premiums increased from BD41.93 million in the first six months of 2020 to BD45.73m as of end-June 2021.

Medical insurance has the largest share in terms of gross premiums, accounting for around 32pc of total premiums/contributions written in the first half this year.

Gross premiums/contributions generated in the domestic market amounted to BD143.70m ($382.18m) in the six months ended June 30, 2021 compared to BD134.63m ($358.05m) in 2020, showing growth of around 6.7pc.

A significant part of such results attributed to a surge in long-term insurance, which increased from BD24.65m for the period ended June 2020 to BD30.39m in the same period in 2021, showing an increase of around 23pc and representing almost 21pc of the total premiums/contributions written in the market.

Motor insurance constituted the second largest category of business, generating gross premiums/contributions amounting to BD34.51m in the six months ended June 30, 2021 compared to BD36.59m for the same period in 2020.

Motor insurance accounted for 24pc of total premiums/contributions written by the market in Bahrain in the first half of 2021.

Total gross contributions of takaful firms were BD43.76m in the six months ended June 30, 2021.

Gross contributions of takaful firms represent around 30pc of the total gross premiums/contributions in Bahrain during the first half of 2021.

In the six months ended June 30, 2021, Bahrain’s domestic insurance market comprised 21 locally incorporated firms and 10 overseas insurance firms (branches of foreign companies) carrying out insurance, reinsurance, takaful, retakaful and captives business in the kingdom.

Locally incorporated firms consisted of 12 conventional insurance firms, five takaful firms, two reinsurance firms, one retakaful firm and one captive, while overseas insurance dirms consists of nine conventional insurance firms and one reinsurer.

In addition, there are a substantial number of insurance brokers and insurance ancillary services.

“The insurance sector in Bahrain holds tremendous promise for growth, as demonstrated by the industry’s strong performance for the six months ended June 2021, this is despite the repercussions of the Covid-19 pandemic, as it was one of the reasons for increasing insurance awareness, especially with regard to health/medical insurance and its importance in such circumstances,” said Abdulrahman Al Baker, executive director for financial institutions supervision at the CBB.

“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 soundness of regulatory and supervisory framework of the insurance sector in Bahrain,” added Mr Al Baker.

Also commenting was Elham Taleb, director of the insurance supervision directorate at the CBB, who said: “The CBB is following up with insurance companies the process of digital transformation in insurance services, especially in motor and medical insurance, in line with Vision 2030 and the CBB plans for digital transformation, in order to provide the best insurance and financial services to the public and to apply best practices to ensure the protection of the public and companies operating in Bahrain.”

avinash@gdn.com.bh

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