Press Release - OCTOBER 03, 2019

AM BestTV: Energy Risks Dominate MENA Reinsurance Sector, Says AM Best Director


CONTACTS:
 Lee McDonald
Group Vice President, Publication and News Services
+1 908 439 2200, ext. 5561
lee.mcdonald@ambest.com

FOR IMMEDIATE RELEASE

OLDWICK - OCTOBER 03, 2019
In this AM BestTV episode, Salman Siddiqui, director of analytics, AM Best, said large European insurers are key players in the Middle East, with local reinsurers playing a follower role. Click on http://www.ambest.com/v.asp?v=globalremena919 to view the entire program.

For some reinsurers operating in the Middle East and North Africa (MENA), there have been some distinct challenges, though some companies have benefited from the opportunities. Siddiqui highlighted some of the key characteristics of the MENA reinsurance market.

“Similar to the global reinsurance market, the MENA reinsurance market is characterized by increasing competition,” said Siddiqui. “Despite the withdrawal of some capacity, the pressure on rates remains similar to the international reinsurance market. Furthermore, the MENA region is dominated by international European reinsurance companies. The big four have a major stake in the Middle East, as the market is dominated by the energy sector. As the price of oil goes up and down, so does the demand for reinsurance.”

Siddiqui also addressed the operating performance of companies in the region.

“In terms of combined ratio, the MENA market is slightly behind the global average, and therefore, has a lower level of underwriting returns. However, the North African market has seen an interesting trend. The loss ratios have been seeing an uptick over the past three years. This is driven by these companies trying to diversify their portfolio beyond their core markets. Consequently, they are attracting new business and are pricing it slightly lower to get that business on their books, which will increase their loss ratios over time.”

To access a copy of this market segment report, titled, “MENA Reinsurers: Turbulence Creates Opportunity,” visit http://www3.ambest.com/bestweek/purchase.asp?record_code=290352 .

Recent AM BestTV episodes include:


  • From the InsureTech Conference: Insurtech Women Founders Say Profitability Builds Trust: Jennifer Byrne, co-founder and president, Quesnay; Carey Anne Nadeau, founder and chief executive officer, ODN; and Kate Terry, co-founder and chief operating officer, Surround Insurance, said the ranks of women in insurtech may be small, but creativity, resourcefulness and industry knowledge build impact: http://www.ambest.com/v.asp?v=diversityinsurtechpanel919 .

  • From the WSIA Annual Marketplace: E&S Crystal Ball Shows Higher Rates, More Risk Sharing, Social Inflation Ahead: Attendees said that while they remain positive about what the future holds for the excess and surplus lines industry, insurers still need several years of price firming to make up for years of cutting: http://www.ambest.com/v.asp?v=wsia2919 .

  • From the NAMIC Conference: Mutuals Look to Link Small-Town Values With Big-Time Technology: Attendees at the National Association of Mutual Insurance Companies’ (NAMIC) annual convention said insurtechs are bringing new service and product opportunities, helping insurers meet the expectations of today’s prospects and policyholders: http://www.ambest.com/v.asp?v=namic2919 .

AM BestTV covers exclusive AM Best and insurance industry information and reports, targeted topics and key developments in the insurance, reinsurance and related sectors daily. Sign up for alerts ofepisodes at http://www.ambest.com/multimedia/ambtvsignup.html . View AM BestTV episodes at http://www.ambest.tv .

AM Best is a global credit rating agency and information provider with an exclusive focus on the insurance industry.