Dubai International Financial Centre (DIFC), the leading global financial centre in the Middle East, Africa and South Asia (MEASA) region, continues to steer the city’s position as a global hub for the insurance and reinsurance industry. Having granted several licences to insurance and reinsurance companies in recent months, the sector is on track for 20 per cent annual growth.
DIFC recently welcomed Hensley Wynne Furlonge Partners (Middle East) Ltd, MNK Re Ltd, Optio Re MENA Ltd, Swan Insurance Management Agency Ltd, Waica Reinsurance (DIFC) Ltd and YOA Risk Services Ltd. They join preeminent industry names including AIG, Berkshire Hathaway, Zurich, Marsh, Aon and Willis to access the largest untapped market in the world through DIFC.
The new joiners cover a broad range of insurance and reinsurance lines that will enable them to grow across the region. These lines include transactional risk insurance within the M&A process, medical, personal accident, travel, property, engineering, liability and marine.
Additionally, supporting the Centre’s vision to drive the future of finance, Virtual I Technologies Ltd, an InsurTech company from the DIFC Innovation Hub, has become the first InsurTech to upgrade and obtain a regulatory licence from the Dubai Financial Services Authority (DFSA). Virtual I Technologies Ltd has created the most sophisticated AI-based risk assessment tool in the world and has moved to the next phase of growth to be a capacity distributor based on a digital gateway platform between capacity providers, global agents, local agents, and retail brokers.
Over the past five years, DIFC has seen an influx of insurance and reinsurance players with a 43 per cent representation of Managing General Agents (MGAs) from Africa, Asia, Europe and Middle East contributing to the USD 2.1bn market. The continuing increase in company registrations from the sector provides a buoyant outlook for workforce as well as gross written premiums, which has already increased by 18 per cent to USD 1.2bn in the first six months of the year when compared to the same period in 2022, and by 34 per cent since 2021.
As a market creator, DIFC has built a globally recognised regulatory environment with strategic, financial, and operational benefits associated with geographical expansion for reinsurers, brokers, independent MGAs, and Lloyd’s service companies and coverholders. In addition, buoyant oil prices, increased infrastructure spending and low insurance penetration in the region have worked positively for the reinsurance market within DIFC.
Arif Amiri, Chief Executive Officer of DIFC Authority, commented: “DIFC has been delighted to welcome an impressive stream of new insurance and reinsurance companies during the first nine months of 2023, on track for 20 per cent annual growth.
Today, we are home to more than 100 registered insurers, reinsurers, captives and insurance-related entities who are using our platform to achieve their growth ambitions. Our world-class laws and regulations are comparable to other advanced markets across the globe and enable our insurers and reinsurers to confidently operate in the jurisdiction, tap into new growth opportunities in the region, and collectively contribute to the Centre’s vision of driving the future of finance.”
Over the last 20 years, DIFC has driven the development of the insurance and reinsurance industry. This includes co-hosting the Dubai World Insurance Congress, which has rapidly become an important forum to address key issues and opportunities for the sector. The 2023 event saw more than 1,100 industry professionals, representing 60 countries across the world gather to discuss supporting economic growth, attracting talent to the insurance industry, embracing technology, and supporting climate change and decarbonisation initiatives.
It was encouraging that an independent survey conducted during the Congress identified 87 per cent of respondents are confident in the MEASA market and the strategic opportunities it holds.
The survey further highlighted that property, health, energy, cyber and liability lines of business hold the most potential for the MEASA region. Reflecting the growing sophistication of insurance markets and increasing demand for insurance/reinsurance, the survey showed that 85 per cent of respondents are confident in 2023 renewals and the possibility of retaining clients.
Another initiative spearheaded by the Centre recently gathered the growing community of DIFC- based MGAs to assess their future, drivers of growth from the current economy and challenges they need to overcome to achieve their aspirations in the region. It is anticipated that the community of MGAs in DIFC will continue to assume key roles in the insurance distribution chain by penetrating new markets, accessing new opportunities, and simplifying processes for the insurance provider and the insured.
The Centre also offers opportunities for continuous engagement with insurers, transparent communications, access to timely data and scope to nurture talent and provide education. These are meaningful advantages that will encourage most insurers to recommend Dubai and DIFC as a global hub for insurance and reinsurance.
To learn more about how DIFC and financial hubs shape the insurance and re-insurance industry and the power of technology in developing data and analytics to bridge gaps in the sector, tune into DIFC’s latest podcast “Time to insure Millennials” episode on the future of insurance here.