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QATAR: CATALYSING CHANGES IN INSURANCE AWARENESS...
September, 2013
 

Elie Hanna, General Manager at AIG Qatar, speaks to ta’ameen Qatar about facts, figures and the increasing awareness of insurance in the Qatari market. 

According to you, which line of insurance remains under penetrated in the State of Qatar? 

Insurance penetration in Qatar is generally low and stands at about 1.2 percent when compared to the Western world. Hence, one would expect various lines of business to be under penetrated. 

Based on our experience, the following lines of insurance remain under penetrated in the Qatari market: 

Consumer Insurance: 

Home insurance (property and content)and Personal Accident 

Commercial Insurance: 

Directors and Officers Liability 

Professional Indemnity – other than the PI single project architect and engineers, which is a compulsory requirement. 

Cyber Risks 

Public Liability: organisations could be considered to be under insured Vs. the actual exposure to liabilities. 

Small to Medium Enterprises – as a segment, across all lines of business (Property, Liability, Workmen compensation etc.)

 

Elie Hanna, General Manager at AIG Qatar 

 

Considering most premiums are related to engineering and construction, how much of the risk is actually ceded to the reinsurers? 

In Qatar, reinsurance cession varies by line of business. Whilst motor and medical insurance retentions remain on the higher side, other lines of business retention including fire, engineering and construction remain generally low. 

Based on the latest market results, we could assume that on an average, about 45 to 50 percent of the overall Gross Premium is ceded to reinsurers. However, in general, we have seen an increased level of local retention, which is an indicator of improved risk taking and change in business mix. 

What is recall liability insurance? Are manufacturing companies in Qatar mandated to purchase the product? 

 

AIG product recall insurance policies cover defective consumer goods and contaminated products. The cover meets the cost of physically withdrawing the defective product from store shelves, customers, warehousing or other distribution channels and associated transportation. It also covers ancillary costs of advertising, overtime, hiring additional staff or storage space, replacement and disposal costs. 

 

Product recall also covers: 

Defense costs for any litigation directly caused as a result of the recall or any damage or injury resulting thereof. 

Lost profits – loss of gross profit that would have been expected had the loss not occurred or increased working costs incurred to avoid a fall in sales figures. 

Additional advertising or marketing strategies like special offers to regain or recover market share are covered to up to 25 percent of the insured amount. 

Recall consultancy services even before a loss. 

Post-loss consultancy expertise. 

Our understanding is that product recall insurance is not compulsory in the State of Qatar. 

 

What are the factors, which you feel, could affect or enhance growth in the insurance sector for 2013? 

In my opinion, Qatar’s insurance market is on a growth trajectory mainly as a result of the government and public spending and infrastructure growth to support the 2022 FIFA World Cup and 2030 National Vision of Qatar. 

 

 

However, various factors could affect the level of growth in the upcoming few years. To name a few, they could be as follows: Introduction of compulsory insurance (medical insurance). 

Improved role of risk managers in large organisations

Key role of insurers in improving risk awareness and introducing products based on the need of the local market. 

Growing affluent population 

Improved insurance awareness of the SME segment.

 

 

As an insurer, what is AIG doing to raise the profile of insurance in Qatar? 

At AIG, we strive to raise the profile of the insurance industry in all countries we operate in. This includes Qatar for sure. Our main agenda is to bring innovation to the insurance market through our range of products and distribution strategies. 

We consider that the key priority of any insurer is to listen to the client and cater to the needs of the market. This is why we have introduced a number of new insurance products such as Cyber Risks, Trade credit and others. 

We also believe that educating and supporting our customers and key partners is a critical contributor to the success of the insurance industry. This is why we have organised workshops and seminars in the market. Most recently, we have organised a joint seminar in Doha to discuss directors and senior management liability and how insurance can mitigate these risks. 

Additionally, we have participated in the Multaqa event hosted by the Qatar Financial Centre (QFC) in which, we have hosted round table discussions with industry leaders to discuss the key issues facing the MENA market. 

 

West Bay, Doha 

 
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