The Bahrain insurance market posted a growth of 5 per cent during 2014 over the previous year, with gross premiums/contributions registering BD270.76 million ($777 million), according to figures released by the Central Bank of Bahrain.

A significant part of this increase attributed to a surge in medical insurance, which has increased from BD40.83 million in 2013 to BD48.59 million in 2014, showing an increase of around 19 per cent and representing almost 18 per cent of the total premiums/ contributions written in the insurance market in 2014.

Motor insurance increased from BD68.05 million in 2013 to BD72.25 million in 2014, showing an increase of around 6 per cent. Motor insurance is the largest in terms of gross premiums which represented around 27 per cent of the total premiums/contributions written in 2014.

The takaful industry in Bahrain generated gross contributions amounted to BD57.29 million in 2014 compared to BD57.22 million in 2013. Gross contributions of Takaful Firms represent around 21 per cent of the total gross premiums/contributions in 2014.

By end of 2014, 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 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 2014 but also during the past five years” said Abdul Rahman Al Baker, executive director, Financial Institutions Supervision, at the CBB.

“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,” said Al Baker.

By end of 2014, there were five conventional reinsurance firms and two retakaful firms in Bahrain. The gross premiums/contributions of Reinsurance and Retakaful Firms reached BD412.52 million in 2014 compared to BD336.57 million in 2013, an increase of around 23 per cent over the year 2013.

“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” added Al Baker.

Long-term (life and savings products) insurance generated gross premiums/contributions amounted to BD56.88 million ($150.87 million) in 2014. The long-term insurance premiums/contributions represented 21 per cent of the total premiums/contributions written by insurance market in Bahrain in 2014.

Medical insurance witnessed a growth of almost 19 per cent in gross premiums/contributions to register BD48.59 million ($128.88 million) in 2014 compared to BD40.83 million ($108.30 million) in 2013. Medical insurance premiums/contributions represented around 18 per cent of the total premiums/contributions written in Bahrain insurance market in 2014.

Motor insurance constituted the single largest class of business, generating gross premiums/contributions amounted to BD72.25 million ($191.64 million) in 2014 compared to BD68.05 million ($180.50 million) in 2013, an increase of around 6 per cent. Motor insurance accounted for 27 per cent of the total premiums/contributions written by insurance market in Bahrain in 2014.
 
Fire, property & liability insurance premiums/contributions represented 18 per cent of the total premiums/contributions written by insurance market in Bahrain in 2014. Fire, Property & Liability insurance premiums/contributions totalled BD49.74 million ($131.94 million) in 2014 compared to BD47.20 million ($125.19 million) in 2013, showing an increase of approximately 5 per cent.

“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” said Fouad A Wahid Abdulla, director, Insurance Supervision Directorate, at the CBB.

“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. – TradeArabia News Service