Ahead of the launch of mandatory health insurance scheme, health covers continue to drive the growth of Oman’s insurance industry, contributing more than 37 per cent of the total non-life premiums in the sultanate.
Oman’s insurance sector grew at annual average growth of 3.3 per cent between 2013 and 2018 with gross written premiums (GWP) reaching to US$1.1bn. One of the main drivers of the growth in non-life segment was health insurance, whose share in non-life GWP grew from 18.1 per cent in 2013 to 37.7 per cent in 2018, primarily aided by the growing awareness of health insurance and increased coverage by employers, as per the GCC Insurance Industry Report released by Alpen Capital on Sunday.
It said the number of employees in the private sector covered by health insurance in Oman jumped to 450,000 (22.7 per cent of the total) as of 2018, up from 171,763 (9.9 per cent of the total) in 2017. ‘Consequently, the health insurance segment has overtaken the motor segment to become the biggest market segment (37.7 per cent), in terms of insurance premiums, in Oman.’
Earlier this year, the Capital Market Authority (CMA) issued the unified health insurance policy, which is to be implemented for private sector employees, including expatriates and visitors to the sultanate.
‘The unified health insurance policy, which is expected to be rolled out from 2020, is anticipated to benefit over 2mn workers in the private sector and visitors with a guarantee of minimum basic health coverage for inpatients and outpatients, emergency conditions, treatment of disease and out-of-pocket expenditure,’ Alpen Capital said.
While the provision of mandatory health insurance is likely to aid towards industry growth and attract foreign insurance players in the country, Alpen Capital noted that the CMA is planning new investment regulations related to takaful and the underwriting process. ‘The implementation of mandatory health insurance from 2020 and employers providing medical cover will further support growth of the non-life segment in Oman.’
According to Alpen Capital, Oman’s insurance market is estimated to reach US$1.3bn in 2024, registering an annual average growth of 2.7 per cent from 2019. The life segment is estimated to grow at an annual rate of 6.1 per cent in the next five years, while the non-life segment is estimated to grow at a 2.1 per cent between 2019 and 2024. Growth in Oman’s life insurance segment is expected to be the highest in the GCC region and is supported by rising population.
‘The implementation of mandatory health insurance from 2020 and continuation of health cover by employers will support the growth of the non-life segment. The number of employees covered under the new mandatory health insurance scheme is expected to surpass than 2mn, in addition to Omanis working in the private sector and visitors to the sultanate,’ Alpen Capital’s report added.