Insurance Growth in MENA: A Promising Region

1. Middle East & North Africa Why is this an insurance growth region?

2. MENA • Profile • An insurance growth region • Current figures and outlook MORO 2006 - London June 13th

3. More than 20 Countries • Morocco, Algeria, Tunisia, Egypt,Libya • Lebanon, Palestine, Israel, Jordan, Syria, Iran, Iraq, Turkey • Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, United Arab Emirates, Oman, Yemen. MORO 2006 - London June 13th

4. Different economy features • Common cultural heritage, but : • Various stages of economic development • Different natural resources endowment (especially oil) MORO 2006 - London June 13th

5. MENA Vs World • Population : • 7.7% of the world’s population • Total GDP : • Around USD 2 trillions MORO 2006 - London June 13th

6. MENA • Profile • An insurance growth region • Current figures and outlook MORO 2006 - London June 13th

7. Development drivers • Regulation • Investment • Takaful • Compulsory insurance • Bancassurance MORO 2006 - London June 13th

8. United Arab Emirates • BMA developed a world-class regulatory system. • BMA is finalizing a new rules book for the growth of specific lines of business : • Takaful & Retakaful • Bancassurance & Reinsurance • Captive insurance • Professional services (TPA) MORO 2006 - London June 13th

9. Egypt & Kuwait • Egypt / Insurance reforms pushed forward • New provisions to prevent money laundering • Internal audit committees to ensure compliance with government regulations. • Kuwait / New decree • Revision of licensing requirements for brokers, agents and consultants MORO 2006 - London June 13th

10. Jordan & Libya • Jordan / New set of regulations • Minimum required capital increased • Solvency margin increased • Libya / Insurance market opened • New insurance companies are expected to enter the market. MORO 2006 - London June 13th

11. Oman & Saudi Arabia • Oman / Transfer of regulation authority • From Ministry of Commerce and Industry to Capital Market Authority. • Saudi Arabia / New regulation and authority • In 2003, promulgation of the long-expected regulation relating to the establishment and licensing of (re) insurance companies. • SAMA is the insurance authority body MORO 2006 - London June 13th

12. Development drivers • Regulation • Investment • Takaful • Compulsory insurance • Bancassurance MORO 2006 - London June 13th

13. Investments • New investments thanks to planned policy reforms : • 16 Arab MENA nations showed their intention to pursue their comprehensive reform : Economic, political, social, educational and legal. • New opportunities for insurance services from : • Privatization programmes, • Expected rapid growth in infrastructure development in the Gulf Cooperation Council (GCC). MORO 2006 - London June 13th

14. Investments • Expected new investments driven by liberalization of the insurance sector : • Continuing and encouraging reform in insurance legislation, particularly in Saudi Arabia. • Opening of markets in Libya and Syria and untapped potential in Iraq. • Global liberalisation of financial services as part of WTO membership. MORO 2006 - London June 13th

15. Development drivers • Regulation • Investment • Takaful • Compulsory insurance • Bancassurance MORO 2006 - London June 13th

16. Takaful • Takaful products contributed & are expected to continue to contribute to insurance business growth. • Innovative customer needs driven products • Overcome social and religious insurance demand inhibitors • Interest for Takaful is growing among customers. • Number of Takafuls companies is growing fast. • Number of Takaful windows is growing as well MORO 2006 - London June 13th

17. Development drivers • Regulation • Investment • Takaful • Compulsory insurance • Bancassurance MORO 2006 - London June 13th

18. Compulsory insurance • In UAE, demand for insurance increased exponentially due to the introduction of two compulsory lines : • Third party motor liability • Medical protection. • Saudi Health Insurance Market expected to grow by four times in a very short term reaching USD 1 billion. MORO 2006 - London June 13th

19. Compulsory insurance • Algeria passed a law in August 2003, following the earthquake in May of that year, making insurance against natural hazards obligatory MORO 2006 - London June 13th

20. Development drivers • Regulation • Investment • Takaful • Compulsory insurance • Bancassurance MORO 2006 - London June 13th

21. Bancassurance • In Saudi Arabia, • SAMA allowed local banks collaborate with insurance companies in the family takaful field through Bancassurance. • Bancassurance has improved production levels and is expected to account for 30% of market by 2010. • Syria, which has an important banking potential, encouraged bancassurance development by the opening its financial, banking and insurance sectors. MORO 2006 - London June 13th

22. MENA • Profile • An insurance growth region • Current figures and outlook MORO 2006 - London June 13th

23. Premium income in GCC MORO 2006 - London June 13th

24. Premium income in N-Africa MORO 2006 - London June 13th

25. Growth rates MORO 2006 - London June 13th

26. 2004 MENA Premium income MUSD MORO 2006 - London June 13th

27. 2010 premium income (e) MUSD MORO 2006 - London June 13th

28. Thank you Ref : The ARAB BUSINESS MAGAZINE “ Al- Iktissad wal- Aamal” (March 2006). The Annual ARIG Review of the Arab Insurance Market 2003. The BMA Islamic Finance Review (issue 2 & 10). The Insurance Review (issue 6). L’Argus de l’Assurance (July 2005).