Oman’s insurance market set to reach $1.3 billion in 2024

MUSCAT, NOV 24 – Oman’s insurance market is estimated to reach $1.3 billion in 2024, registering a compounded annual growth rate (CAGR) of 2.7 per cent from 2019, according to the GCC Insurance Industry report published by Alpen Capital (ME) Limited, a Dubai-headquartered investment banking advisory firm. The life segment is estimated to grow at a CAGR of 6.1 per cent while the non-life segment is estimated to grow at a CAGR of 2.1 per cent between 2019 and 2024. Growth in life segment is expected to be the highest in the region and is supported by rising population, which is projected to grow at a CAGR of 3.1 per cent between 2019 and 2024.
The implementation of mandatory health insurance from 2020 and continuation of health cover by employers will support the growth of the non-life segment. The number of employees covered under the new mandatory health insurance scheme is expected to surpass than two million, in addition to Omanis working in the private sector and visitors to the Sultanate. Furthermore, Oman is witnessing a series of construction projects as the government diversifies away from its traditional sectors. In 2019, the government allocated $9.6 billion for infrastructure development, industrial and services projects and, today, the country has approximately 2,410 active construction projects with a combined value of over $190 billion.
The strong infrastructure developments are likely to expand the underwriting base for non-life commercial lines. However, insurance penetration and density in the country are expected to slightly drop to 1.4 per cent and $259.3 by 2024. According to the report, the GCC insurance market is projected to grow at a CAGR of 4.3 per cent from $29.2 billion in 2019 to $36.1 billion in 2024. Sustained economic growth, increase in population and substantial infrastructure development are among the leading factors that will facilitate growth of the sector. Additionally, governments’ efforts to strengthen regulations, introduce mandatory lines and diversify the economy are also likely to drive GWP for the insurance industry.
The gradual slowdown of the insurance industry witnessed over the past two years is likely to continue until 2024. However, GWP is expected to improve relative to the subdued levels of growth recorded in the recent past, as long-term growth prospects continue to remain positive.