As regional instability continues following the murder of the US Ambassador to Libya and with violence breaking out on the Turkish and Syrian border, countries are still struggling to take their first tentative steps towards democracy and economic transformation. They will require international support. This support will need to be in the form of financial investment in infrastructure development as well as in local training.
International support can also lend weight to local reform agendas, allowing for more sustainable growth in these countries.
Locally based insurance brokers can provide insight and advice to international investors, and in turn, as the economies of these countries start to strengthen so will the need for insurance. The success of the Muslim Brotherhood could also drive growth for takaful and retakaful covers, as these are acceptable forms of insurance in Islamic societies.
The role of brokers in MENA is developing. Brokers from both local and international companies need to be prepared to invest in training local talent as without this it will be hard for the insurance industry to keep pace with the developing regions.
As new financial centres develop across the Middle East, so too will the regulatory environment. While this is a good thing, it will place greater responsibility on companies to improve internal controls, increase financial transparency and improve risk management. It does have a sting in the tail, as insurers will need to be aware of the different environment in each jurisdiction and amend their approach.
To learn more about the changing role of insurance brokers in Middle East click Insurance in the Middle East to read my article published in Middle East Insurance Review.