The UAE insurance market growth continues to gain momentum, with forecasts projecting a 10 to 20% rise in 2025. This follows an impressive 20% increase in 2024, highlighting the sector’s resilience and adaptability. Despite extreme weather events and global economic uncertainty, the market remains strong. Digital transformation and strategic reforms have played a key role in the continued UAE insurance market.
Across the Gulf region, insurance markets are expanding, though not at the same pace. The UAE, however, stands out due to rapid digital innovation and swift post-crisis recovery. Emir Mujkic, director of Insurance Ratings at S&P Global Ratings, says that UAE insurers are heavily investing in automation and tech platforms. These tools are improving operational efficiency, particularly in claims processing and customer service, critical elements that support sustained insurance market growth.
Furthermore, insurers are adopting advanced data analytics to offer customized products. Through user-friendly digital platforms, customers now enjoy easier access and a more tailored experience. This digital-first approach is not just a trend, it is a core driver of insurance sector growth in the UAE.
Despite progress, the industry faced a major test in 2024. Record-breaking rainfall in April led to insured losses of $2.9 billion to $3.4 billion. The floods primarily damaged properties, followed by engineering assets and motor vehicles. While international reinsurers bore much of the burden, local insurers managed the fallout well, thanks to robust reinsurance strategies. This event, however, exposed gaps in climate risk modeling, an area the UAE insurance sector must now improve.
Still, the insurance industry in the UAE bounced back with strength. Listed insurers reported a 21% rise in revenue for 2024, largely due to higher premiums in motor and property insurance. The top five insurers, which control over 85% of total profits, have strengthened their market dominance. This signals increasing consolidation in the UAE insurance market.
Looking ahead, growth prospects remain strong. The mandatory expansion of medical insurance in the Northern Emirates, launched in January 2025, will further drive the UAE insurance market growth. Regional insurers with well-established brands are expected to benefit the most. AM Best forecasts a low claim rate at the start, but predicts increased utilization over time as policyholders become more aware of their benefits.
Even so, the medical segment still faces hurdles. Rising claims costs, fierce price competition, and high service usage are pressuring profits. In response, some insurers are tightening their underwriting criteria and dropping unprofitable corporate accounts. These moves aim to protect long-term performance and ensure steady insurance market development.
Commercial lines such as property and engineering remain reliant on reinsurance. Yet global reinsurers face shrinking margins after the 2024 floods, which could influence future pricing structures. Nevertheless, the insurance market in the UAE remains well-prepared, supported by strong reinsurance programs and technical expertise.
In conclusion, UAE insurance market growth shows no signs of slowing. The sector has turned challenges into opportunities, leveraging technology, reforms, and strong financial frameworks. The UAE’s ability to adapt swiftly positions its insurance market as a leader in the Gulf—and a global example of resilience and innovation.
