Saudi Arabia insurance industry to grow by 25%: S&P

Gross written premiums in the Saudi Arabian insurance industry will grow by 25 percent higher this year, compared to 2014, according to Standard & Poor’s (S&P).

The rating agency firm claimed in a new report that the boost is anticipated due to price increases on the main insurance lines - group medical and motor.

“Growing demand for insurance in the near term, combined with regulatory encouragement of highly prudential ‘actuarial pricing’ after the price war of 2012-2013, means that Saudi Arabia's insurers are showing few signs of being affected by the fall in oil prices,” said S&P.

“Consequently, we consider that the strong growth in sector premiums is likely being driven by the demographics of an expanding population.”

S&P said that although performance varies considerably among Saudi Arabia's 34 locally incorporated insurance companies, there is an overall positive trend which can be seen in the market’s improving tariffs, increasing earnings, enhanced capitalisation, and growing total premium volumes.