By Ed Attwood
French insurer records healthy 19% increase in Middle East profits during 2009.
The high number of players in the Middle Eastern insurance sector may drop, as companies either fold or move towards consolidation, a prominent local executive has warned.
“One of the problems we have had to face is that the market is overcrowded with insurance companies, and a lot of them have nothing to sell but their prices,” AXA Gulf CEO Jean-Louis Laurent Josi told Arabian Business on Monday.
“It’s very fragmented, and it’s not easy for those customers who see insurance as being a tax.”
When asked whether this would lead to players dropping out of the market, Laurent Josi said: “That’s my feeling. At the end of the day, I see no reason why this region should not evolve in the same way as more mature countries have. So I do believe there will be more consolidation.”
AXA Insurance’s Gulf and Middle East division has just recorded strong results for 2009, despite a challenging climate for the insurance sector and the economy in general.
The firm reported a nineteen percent growth in profits to just over $40m, and said its customer satisfaction level now stands at 88 percent.
Other than the UAE, AXA’s Gulf countries reported growth of between fifteen to 26 percent. The Abu Dhabi market was up by 25 percent, while the Dubai market was “slightly down”.