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During the previous year, insurers in this area displayed 1.3 billion AED (353.96 million USD) in net profits, up by 47.4% in comparison with 2016.
However, Hydrocarbon falling prices, political instability, competition and value-added tax (VAT) have weighed down insurers’ profitability at the regional level. The rating agency insisted on highlighting the market upsides, especially, the promotion of risk culture and improvement of the legal framework.
On a longer-term basis, A.M. Best is expecting some improvement of insurance penetration rate, pushed, in particular, through the introduction of compulsory insurance.
The GCC region comprises the following countries: Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates.
Read also | Insurance in the Gulf countries
