Egypt Insurance Report Q2 2016
BMI View: Egypt's insurance market offers significant growth potential. Average household income ratesare improving which will increase the affordability of a range of life and non-life products. Demand for keylines, such as motor and health insurance, remains high and we are seeing a broadening in the range ofproducts available in the market. Key to growth will be the expansion of takaful and microinsuranceproducts which will enable insurers to access to the large first time user market. Barriers to growth remain,however, including a fragmented marketplace and uncertain regulatory environment.
Key Updates And Forecasts
Takaful insurance is growing rapidly in Egypt. The Secretary-General of Insurance Federation of Egypt,Abdel-Raouf Kotb, recently reported that takaful insurance now accounts for 11% of the country'sinsurance market.
Work continues on drafts of a new health insurance bill which is expected to be presented by governmentto parliament. The new health insurance law will include the introduction of health insurance paymentsand will expand coverage, though we note it has come under significant criticism from medicalpractitioners in the country.
Demand for property and motor insurance will be some of the key drivers of growth in the Egyptian nonlifesector where we expect premiums to grow by an annual average of 11.2% (in local currency terms)between 2016 and 2020.
Substantial growth is also expected in the slightly smaller life insurance segment, where we expectpremiums to grow by an annual average of just under 13.0% over the forecast period, increasing fromEGP8.2bn in 2016 to EGP13.0bn in 2020.
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