Bahrain: Consolidation needed in insurance industry to stop price wars
Source: Middle East Insurance Review | Sep 2024
The insurance market in Bahrain needs more mergers or acquisitions between insurance companies and even between reinsurance companies, Bahrain Insurance Association chairman Jawad Mohammed said.
He said that the insurance sector in Bahrain is currently overcrowded, resulting in chaos in prices and services.
He told the Arabic-language newspaper Al-Ayam that M&A was important in reducing the price war in the insurance industry and for providing high-quality insurance services.
He said, “The lack of correct pricing negatively affects the level of service and is not in the interests of the end user, and also negatively affects the profitability of insurance companies and their shareholders.”
Mr Mohammed also highlighted the challenges that the insurance industry faces. He said, “The rise in interest rates has led to a decrease in liquidity and reduced borrowing, and in turn to a decrease in the sale of life insurance policies.”
But the most significant challenge currently is technological advances, he said. For instance, the trend toward using AI to carry out underwriting and claims management tasks will change the nature of jobs. Therefore, companies will need to train employees for new roles, including creating actuarial jobs. M