Featured, Special Reports

Insurex 2010

Exploring new growth opportunities for the insurance sector.

Held under the patronage of His Highness Sheikh Hamdan Bin Rashid Al Maktoum, Deputy Ruler of Dubai and UAE Minister of Finance and Industry, the Insurex 2010 conference attracted more than 25 high-level speakers and more than 150 delegates to explore new growth opportunities for the Middle East insurance sector.

Opened by His Highness Sheikh Hasher bin Maktoum Al Maktoum, INSUREX 2010 brought together leading insurance companies and government officials, includingDr Haidar Al Yousuf, director of the funding department, Dubai Health Authority.

Dr Haidar was the special guest on an innovative health and wellness panel that explored potential partnerships between healthcare providers, employers and health insurers. Mark Jardin, managing director of Aetna Global Benefits Middle East, was joined by a diverse range of healthcare providers and employers including the Dubai Mall Medical Centre and IBM.

There were also sessions on takaful, risk management and branding which brought together experts including: Mohammed Iqbal Mankani, COO, Dubai Islamic Insurance & Reinsurance (AMAN), Dr Mohammed Al Otaibey, risk management specialist, Dubai Customs, and Thomas Alexander, director of nom marine and hull, Nasco ME.

Financial lines
Peter White, deputy general manager, Marsh Insco, chaired a panel on the opportunities for financial lines (FL) products in the region. Jonathan Abela, assistant general manager at BNI discussed global trends while Alexander Blom, financial lines manager, Middle East, focused on regional potential.

The panel saw a growing need for products such as directors and officer liability (D&O) and professional indemnity/liability. Greater attention is being paid to corporate governance and more accountability is being demanded, while the number of listed companies and foreign directors in the region is growing.

However, despite an increase in claims activity and reports of directors coming under fire in the local press, many businesses are not yet convinced by the need for FL products. More education of clients and brokers is needed, while further legal/company transparency will help.

Credit insurance
Representatives from all major credit insurers active in the region – Euler Hermes, Attradius and Coface – revealed demand and claims trends in the region. The panel was chaired by Nick Jefferson, trade credit leader, March Insco, who explained the scope and features of the product, which offers protection against non-payment due to commercial risks (insolvency of customer) or late payment (protracted default) of trade debts.

The financial crisis and subsequent economic slowdown has caused a spike in demand for credit insurance but more claims are coming through, particularly from hard-hit sectors such as construction. The three major credit insurers envisage strong growth in the region but are being more selective with their underwriting.

Personal lines
Dr Michael Bitzer, CEO, National Health Insurance Company (Daman) provided an overview of health insurance market trends across the region while Elias Fakhoury, group VP and chief strategy and distribution officer, MEDGULF, called for a reexamination of sales and distribution strategies to unlock the potential of life insurance.

Karl Gray, head of personal lines (RSA Middle East) joined Mustafa Vazayil, managing director (Gargash Insurance Services) and Rumi Sanjana, director of general insurance (Nexus) on a panel to explore this theme further.

The overemphasis on price competition in the region should be countered with more focused consumer segmentation techniques and an emphasis on service levels. Measures should also be taken to ensure sales agents and brokers are suitably trained and able to provide independent, quality advice.

Catastrophe insurance
Elias Chedid, director at Chedid Re, chaired a panel on managing catastrophe exposure in the region, alongside Michael Gertsch, chief underwriting officer (Gulf Re) and Murtadha Jawad Ibrahim A l Jamalani, executive director (Oman Re).

The panel considered the importance, causes and consequences of catastrophes in general and in the Gulf in particular. The Middle East and the GCC are not isolated seismic ally and are exposed to natural disasters in addition to man-made
disasters.

The panel highlighted the lack of information that would provide visibility towards the economic impact of catastrophes, as well as the lack of an organised structure to manage and provide a financial cushion in such situations. The role of the insurance sector (including re/insurers, consultants and intermediaries) is critical in providing technical and technological know-how, risk management expertise, financial exposures and losses assessment.

The creation of a CAT pool was recommended that would be supported by GCC governments. The structure of such a pool can be formulated by mutual input between the concerned ministries and the insurance sector.