Doha, 12 September 2011

Qatar Financial Centre Authority publishes latest edition of GCC Reinsurance Barometer

In a new market research report released today, leading professionals working in the reinsurance sector in the Gulf region of the Middle East reported increased confidence in the prospects for stronger pricing in the sector.

• 92% of regional reinsurance professionals expect prices to remain stable or increase
• 88% of respondents interviewed expect reinsurance terms and conditions to tighten
• 71% of respondents interviewed expect profitability to remain stable or improve
• 67% of respondents interviewed expect reinsurance exposure in the region to increase faster than regional growth in GDP

The findings of the latest edition of the GCC Reinsurance Barometer show that almost all the participants surveyed expect reinsurance prices in the GCC to stabilise or increase over the next 12 months to two years.  A total of 92% of the firms interviewed in June and early July this year held this view, which represents a major change in the outlook compared with the results in the previous research at the beginning of 2011, when only 29% expected stable or increasing prices. This turnaround is primarily driven by global developments such as the spate of major insured catastrophe losses in the first half of 2011.

The overall outlook for the reinsurance industry in the GCC has improved significantly in the last six months, as the market continues to grow, while capacity growth slows and pricing improves.

Commenting on the latest report, Akshay Randeva, Director Strategic Development of the Qatar Financial Centre Authority said: “It is clear from the research findings that even in times of global uncertainty the GCC region remains a very attractive market for the global reinsurance industry.  Economic growth in the region is amongst the fastest in the world, which is reflected in the very high levels of planned infrastructure spending. As a consequence we continue to see major interest from the world’s largest reinsurers as well as an increasing number of mid-sized players, which we believe can only be encouraged by the pricing trends revealed in the new edition of the Reinsurance Barometer.”

Interviews were conducted on behalf of the QFC Authority by Kai-Uwe Schanz, Principal Partner of Dr. Schanz, Alms & Company AG, a Zurich-based consultancy. A total of 24 companies, with an estimated collective market share of more than 60%, participated, represented by senior management responsible for the GCC Region. The interviews took place in June and July 2011.

Published twice yearly, the GCC Reinsurance Barometer is the only regular report monitoring the development of the sector in the Region.

A copy of the GCC Reinsurance Barometer can be downloaded by visiting this link