The contribution of Oman’s thriving insurance industry’s to the country’s Gross Domestic Product (GDP) climbed to 1.87 per cent last year (equivalent to RO 466 million in value terms), up from a 1.66 per cent share in 2019 – an uptick that underscored the sector’s inherent socio-economic importance during pandemic-ravaged 2020.
The Capital Market Authority (CMA), which regulates the sector, attributed the growth in part to the industry’s “ability to rapidly respond to the exceptional circumstances” unleashed by the pandemic.
“The insurance companies expanded their insurance umbrella for the holders of health insurance policies to cover all tests and treatment costs of Covid-19 patients further to continuation of providing insurance services non-stop through conventional and modern means in line with the real objects of the insurance industry to protect the community from unexpected risks and consequent financial loss,” said Shaikh Abdullah bin Salim al Salmi, Executive President.
However, gross direct written premiums of insurance companies declined 4.3 per cent in 2020 to RO 465.895 million, compared to RO 486.582 million in 2019, the Authority noted in its 2020 Annual Report.
Gross direct premiums for general insurance dipped 3.2 per cent to RO 412.143 million, down from RO 425.880 million in 2019.
Gross direct premiums for life insurance fell 11.4 per cent to RO 53.752 million in 2020 compared to RO 60.702 million a year earlier.
Amid the pandemic, general and life policies issued by insurance companies slumped 15.1 per cent to 1.640 million policies in 2020 (comprising 1.508 million general insurance policies and 131,676 life policies) versus 1.932 million policies issued in 2019 (including 1.708 million general insurance policies and 224,115 life insurance policies).
Sharia-compliant Takaful companies however fared a tad better than their conventional counterparts.
Gross direct premiums of Takaful insurance increased 1.1 per cent to RO 64.48 million in 2020 compared to RO 64.167 million a year earlier.
Takaful insurance accounted for 14 per cent of the gross direct premiums of insurance companies in total.
Gross premiums of general Takaful business decreased to RO 52.690 million in 2020 compared to RO 54.717 million in 2019. General Takaful represents 13 per cent of the total general insurance of all the companies of the sector.
Gross direct premiums of Takaful companies for family Takaful rose 28.7 per cent to RO 12.158 million in 2020 compared to RO 9.450 million in 2019.
Family Takaful represents about 23 per cent of the total life insurance business of all the companies.
Attesting to the success of ongoing Omanisation in the insurance sector, of the 3,036 individuals employed by the industry, 2,393 were nationals as of end-2020, representing 79 per cent of the total workforce.
Omanis were distributed across various technical and managerial roles in the industry’s 204 insurance companies and their branches around the Sultanate, as well as 69 brokerage firms (and branches) and 152 agencies (and branches).