Saudi property insurance market shows rapid strides

Saudi Reinsurance Company (Saudi Re) organized a seminar on Saudi property insurance market, which was attended by a number of insurance professionals from insurance companies operating in Saudi Arabia.
The seminar comes in challenging times for the insurance industry on the back of the surging number of fire losses in the recent years, the fact that calls for review of the underwriting practices.
The seminar addressed the developments in the Saudi property market, which premiums exceed SR1.3 billion, representing 6 percent of gross written premiums of the whole market.
The speakers emphasized the need to focus on applying the technical standards in pricing and avoid exaggeration in price-led competition.
More importantly, it was highlighted that it is now a necessity for insurers to develop their risk management and loss prevention capabilities and foster a collaborative relationship with the insured clients to enhance the safety standards in the insured facilities through risk surveys and risk improvement recommendations.
The speakers also stressed the importance of inspecting the electrical installations as statistics show that short-circuit is the main cause of fire in buildings. Furthermore, the role of loss adjusters was discussed in the seminar noting that their early involvement is crucial in determining the cause of the loss, assessing the magnitude of the damage, and utilizing the salvage.
Fahad Al-Hesni, Saudi Re’s MD & CEO, mentioned that the size of the property insurance sector has doubled in the last eight years, yet the growth is offset by the losses arising from fire and other natural causes. He added that improving the sector’s performance is highly dependent on investing in risk management, which is an integral part of proactive underwriting management.