Financial experts attending the Gulf region’s first Professional Liability Insurance Forum, held in Manama October 21st to 22nd, stressed the need to launch innovative insurance products to cover liability arising from medical, engineering and banking errors.
They also highlighted the need to train people to work in the insurance and services sectors in order to advance the economies of the Arab world.
Around 300 experts attended the forum, which was hosted by the General Arab Insurance Federation (GAIF) in association with the Bahrain Insurance Association (BIA), with Bahrain’s Economic Development Board serving as a strategic partner.
These included decision-makers from leading insurance companies, financial institutions and companies from across the Gulf region, the Middle East and Africa, who shared solutions to mitigate and manage the risks in the current economic and commercial climate.
During the forum Bahrain announced its intention to launch a batch of legislation governing professional liability insurance, the first of its kind in the Middle East.
The professional liability insurance market can be “a key tool in achieving economic stability for the countries of the Arab region, especially in light of the geopolitical complexities currently prevailing”, said Adnan Yusuf, chief executive officer of al-Baraka Banking Group and Union of Arab Banks board member.
“Professional liability insurance will be one of the main engines of growth for the Arab insurance industry given the right circumstances, both in terms of a forward-looking regulatory environment and the ability to integrate with the constituent sectors of the national economy,” he said.
Yusuf said the insurance market is one of the most resilient and stable in the Arab region, as demand for insurance products and services has remained at relatively high levels despite the global financial crisis.
According to the Central Bank of Bahrain, the volume of insurance premiums in Gulf states totalled about $17 billion in 2012, $8 billion of which was in takaful insurance premiums.
The Central Bank estimates that conventional and takaful premiums in Gulf Co-operation Council (GCC) markets will exceed $37 billion by 2015.
“Arab insurance premiums totalled $27 billion last year (2012), $16.5 billion of which were premiums in GCC markets, representing a growth rate of 11.7% versus 2011,” said GAIF secretary-general Abdul Khaleq Raouf.
Bahrain’s hosting of the event fulfils a recommendation adopted at the 2012 GAIF conference in Marrakech on the need to hold a professional liability insurance forum, Raouf told Al-Shorfa.
“Professional liability insurance has come to represent a significant portion of total insurance volume in the Arab world because of its importance in reducing the liability faced by a number of professions, such as doctors, engineers and bankers who are exposed to numerous risks at their workplaces, requiring that they obtain protection through insurance planning,” Raouf said.
Khaled Saad, senior financial services official at Bahrain’s Economic Development Council, said the council’s participation in the forum stems from its recognition of the importance of promoting the culture of insurance in the kingdom.
“Professional liability insurance is somewhat new to the Arab region and is growing because of its importance in covering liability for losses arising from professional errors or administrative malpractice,” he said.
“The rapid growth of the insurance market in the region reflects the dynamic nature of the economies of Arab countries, and confirms an increase in the level of awareness of the importance of insurance [as protection] against risks and exposure,” Saad said.