The UAE insurance sector maintained its growth trajectory in the first three quarters of 2024 as well. According to the Quarterly Economic Review issued by Central Bank of UAE (CBUAE) in December 2024, gross written premiums (GWP) for the insurance sector grew by 20.9% touching AED50.8bn ($13.8bn) as compared with AED42bn written in the first three quarters of 2023.
The growth in GWP was primarily due to an increase in property and liability insurance premiums by 25.9%, health insurance premiums grew by 21.4% and the insurance of persons and fund accumulation premiums registered a growth of 3.8%. The overall growth was the result of an increase in group life insurance premiums.
During this period, gross paid claims of all types of insurance plans increased by 29.4% to AED29.9b. This growth was driven mainly by the rise in claims paid in property and liability insurance which rose by 66.7%. Claims paid in health insurance increased by 14.6% and an increase of 30% was registered in insurance of persons and fund accumulation.
In the first three quarters of 2024, total technical provisions of all lines of insurance increased by 29.6% to AED97.2bn. The volume of invested assets, which mainly diversified in equity and debt securities, cash and deposits, real estate, other instruments that are A rated, and other invested assets in the insurance sector amounted to AED83.2bn (52.1% of total assets) compared to AED74.4bn (56.5% of total assets) during the same period in 2023.
The retention ratio of written insurance premiums for all types of insurance was 53.8% (AED27.3bn) in three quarters of 2024, compared to 52.5% (AED22.1bn) a year earlier.
Insurance soundness
The UAE insurance sector remained well-capitalised. With regard to the various capital adequacy ratios, the own funds to minimum capital requirement ratio increased to 389.2% compared to 349.8% in the same period in 2023. The own funds to solvency capital requirement ratio reached 198.5% in the period under review compared to 207.3% in the same period in 2023. This was as a result of a decrease in own funds eligible to meet solvency capital requirements; and the own funds to minimum guarantee fund ratio was 288.9% in three quarters of 2024 compared to 310.6% in three quarters of 2023.
In terms of profitability, the net total profit to net written premiums reached 7.1% in three quarters of 2024. The return on average assets decreased to 0.5% in this period compared to 0.6% in 3Q of the previous year.
There are 59 licensed insurance companies in the UAE, comprising 23 traditional and 10 takaful national companies, 25 branches of foreign insurance companies operating in the UAE and one branch of a foreign reinsurance company. The number of insurance-related professions remained unchanged at 498.