The UAE's insurance market is expected to maintain double-digit growth in 2026, driven by the country's economic growth coupled with a rising expatriate population.
At the same time, the biggest challenge insurers in the UAE can expect to face is rising costs and a continued decline in interest rates, said Interim CEO and CFO of Sukoon Insurance, Hammad Khan.
Speaking with Middle East Insurance Review, Mr Khan said, “Inflation is felt particularly in two aspects: one that is purely on the motor side—in the increased costs of spare parts, and the other in terms of medical inflation,” said Mr Khan, adding that insurers will need to consider inflation in their product pricing.
“At the same time, insurers need to invest in AI and digital transformation, face more stringent regulatory supervision. With these transformational changes, there is going to be more emphasis on compliance and robust risk management,” he said.
“As smaller players may struggle to meet the requirements and standards, further consolidation in the industry may be expected as a result.”
An unpredictable environment
Today’s unpredictable operating environment may potentially impact insurers’ liabilities and investments, Mr Khan said, emphasising that robust risk management will be vital.
He said, “Insurers need to focus on modelling risk scenarios and enhance their risk management practices to ensure that if there is an unforeseen event, management is alert to it and can make informed decisions.”
The digital front
Additionally, Mr Khan expects more digital transformation “which will bring improved customer centricity”.
“At the end of the day, companies will have to come up with innovative products to stay competitive,” he said.
He spoke too of emerging demand for cyber insurance, saying, “Even insurance companies need to secure their systems.
“Companies will have to invest to make sure that they can mitigate cyber risks internally to ensure no vulnerability to cyber attacks.”
The full version of this interview is available in the January 2026 edition of Middle East Insurance Review at this link.