A New Year and, we might hope, a new dawn for the Middle East.
For the insurance and reinsurance sector there is every reason to hope that 2021 might signal the start of a new growth phase – and from every tragedy and setback there might spring hope for new friendships, new business and trade opportunities.
New opportunities often lead to new risks – and pricing risk, insuring risk and reinsuring risk are what the industry is all about.
Dare we hope that – after the sucker-punch of COVID-19 last year – we might be entering a decade of growth for the Middle East with new opportunities presenting themselves all over?
Rebuilding Beirut will have to be a priority after the tragedy of last year, which can only mean opportunities for new covers across the spectrum. Opportunities that can make this most historic and beautiful of capitals more robust and help rebuild the lives of those directly affected. It is a truly massive project that should demonstrate that insurance is primarily for good.
A second ray of hope lies in the beginnings of a thaw in relations between Saudi Arabia and Qatar. Trade is a great healer and the resumption of the free movement of goods and people around the region seems guaranteed to require the expert services of those who can price and cover the risk – new opportunities to offer the vital services that only the insurance and reinsurance sectors can meet.
And while we are on the subject of thawing international relations, the prospect of an increasing détente in diplomatic relations with Israel from Saudi Arabia, the UAE and Bahrain could be a significant boost for the insurance industry especially in cyber.
There is a continuing question mark over the scale of the role that the US will continue to play in the region and that is why it is a welcome sign that Israel may forge stronger ties with leading nations in the Middle East.
Recent weeks have illustrated once again the real nature and scale of the threat of cyber attacks from rogue states. We all know that cyber is one of the most feared of the ‘new risks’ and so Israel’s acknowledged leadership in cyber security can only have a positive effect on the risk profile of its trading partners in the wider Middle East region.
And finally, there is the massive logistical project that will absorb the attentions of everyone from the heads of government all the way through to frontline workers in every single nation in the region: The successful vaccination of 250m people.
In the cold light of day, the continual and incremental shift of economies away from their dependence on hydrocarbons – oil or LNG – might seem like a negative for a region best known for exploiting such resources but the reality is somewhat different.
Most of the leading economies of the region have multi-year growth plans in place which already anticipate a future predicated on excellence in financial services, tourism, medical services, trade and the like – real proof of the resilience of the Middle East’s economies.
For the insurance sector this spells a lot of work ahead. Sit down and buckle up.
Paul McNamara
Editorial director
Middle East Insurance Review