The Training Imerative In The Middel The Training Imerative In The Middel East : East :

The Training Needs In The New EraThe Training Needs In The New EraOf The Saudi Insurance MarketOf The Saudi Insurance Market

By Dr. Abdalelah Saaty

Global Mid-East Insurance SummitGlobal Mid-East Insurance Summit

CONTENTS

About Saudi Arab – Geographical View

Population – Local & Expatriates

Education – In General & In Particular about Insurance

Over View of the Saudi Economy

About Insurance – History & its Present Scenario - Growth & Trends

Kingdom of Saudi Arabia

Estimated population by 2007 24 million

Expatriates workers 7 million

Land 829,995 sq mi (2,149,690 sq km)

Population (Million) in Saudi Arabia

0

5

10

15

20

25

30

35

40

45

2000 2010 2020

Million

Years

EDUCATION

At the time Saudi Arabia was founded in 1932, education was not accessible to everyone and limited to individualized instruction at religious schools in mosques in urban areas

EDUCATION

In the nearly half a century that has elapsed since its foundation, Saudi Arabia’s educational system has witnessed an astonishing transformation.

There are as of 2007 (27,900) schools, twenty universities, and (214) colleges and other educational and training institutions.

EDUCATION

The Saudi educational system now provides free education, books and health services to some five million students — one of every four people in the Kingdom — from kindergarten through university, and from adult education to vocational training.

The largest chunk of the kingdom's new budget - more than $16 billion - has been earmarked for education and more technical training programs

Kingdom of Saudi ArabiaEconomic indicators

Oil was discovered in 1936 .

Major trading partners are the United States, Japan, Great Britain and other European Union countries, South Korea, India, China and Singapore.

Saudi Arabia’s economic woes are compounded by several factors, including its vast reliance on the fluctuating prices of hydrocarbon exports, which account for 90 percent

of export earnings and 75 percent of the budget

Historical Insurance Development

The Thirties Stage

The Seventies Stage

The Present Stage

Saudi Insurance Market

Size of insurance market : $ 1.85 Billion

Potential : $ 5.86 Billion

Ins/GNP : 0.5%

Year: 2006 Insurance Density Insurance Penetration

Middle East (ME)

  Total Biz Life Biz Non-Life Biz Total Biz Life Biz Non-Life Biz

Cyprus 906.6 408.6 498.0 4.3 1.9 2.3

Qatar 683.5 30.9 652.6 1.1 0.0 1.0

UAE 585.4 89.8 495.6 1.7 0.3 1.4

Bahrain 398.6 69.8 328.8 1.9 0.3 1.6

Kuwait 227.2 40.9 186.3 0.7 0.1 0.5

Lebanon 181.5 57.9 123.6 3.0 0.9 2.0

Oman 133.7 14.3 119.4 1.0 0.1 0.9

Insurance in the Middle East

Saudi Arabia 63.1 0.8 62.4 0.5 0.0 0.5

Jordan 59.5 6.2 53.2 2.4 0.3 2.2

Iran 40.1 2.6 37.4 1.3 0.1 1.2

Syria 8.5 0.1 8.5 0.6 0.0 0.6

Yemen 2.4 0.2 2.2 0.3 0.0 0.3

Year: 2006 Insurance Density Insurance Penetration

Middle East (ME)

  Total Biz Life Biz Non-Life Biz Total Biz Life BizNon-Life

Biz

Turkey 89.2 13.1 76.1 1.6 0.2 1.4

Insurance In The Middle East

Tunisia 59.2 5.3 53.9 2.0 0.2 1.8

Morocco 52.4 14.7 37.8 2.9 0.8 2.1

Libya 17.9 0.4 17.5 0.2 0.0 0.2

Algeria 18.7 1.2 17.6 0.5 0.0 0.5

Egypt 11.2 4.7 6.5 0.8 0.3 0.5

Year: 2006 Insurance Density Insurance Penetration

  North Africa (NA) Total Biz Life Biz Non-Life Biz Total Biz Life Biz Non-Life Biz

Insurance In The Middle East

Gross written premium – by line of business

Gross written premium – by line of business

Gross written premiums (2005 – 2006)

Insurance Companies In Saudi Arabia

• Licensed Under licensing

18 24

Organization and Regulation Development

Cooperative Health Insurance Law (2000)

Cooperative Health Insurance council

Application for Saudis (2003)

Foreign investment in Insurance Sector (2003)

Monitoring Insurance Companies Law (2004)

Justification for Health Insurance

Relieving Financial Pressure

Developing Private Sector

Providing Employment Opportunities

Better Utilization of Resources

Potential

Saudi Arabia is one of the largest insurance market in the region.

the Kingdom's insurance market is bound for more growth. The Government diversification and industrialization program is opening new avenues in both personal and commercial insurance

Potential In Insurance

Medical and automotive insurance premiums now account for 60 percent of the business. These sectors of insurance market is growing tremendously as the Government enacts mandatory medical and motor insurance.

INSURANCE DEVELOPMENT

Leading world insurers are considering entering the market through new ventures or aligning with existing players in the kingdom

Manpower in Insurance

Total workers

Expatriate

workers

Local workers

New jobs creation for locals

4,200 3360 (80%)

840

(20%) 10,000

Insurance Education

The insurance education has yet not received appreciable attention of the academicians

There is a tremendous need of insurance trained and qualified workforce to meet the growing need of the insurance industry

Most of the insurance technical jobs are being performed by overseas workers.

Insurance Education

Due to the 30% mandatory employment of local people the problem has compounded for the insurance industry as to best accommodate the locals

There are now 10.000 job opportunities in the field of insurance. Yet, there are no qualified people for them.

King Abdul Aziz University has initiated Three Years an Associated Degree program offering insurance practical and theoritical knowledge

Insurance Education

King Abdul Aziz University is looking forward with international institutions to have a mutual cooperation and partnership to promote insurance education in Kingdom

In conclusion

Saudi Arabian market in term of insurance activities whether education or setting up company is full of potential and returns and a joint ventures are high likely to shape

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