On boosting penetration and the diversification of Libya’s insurance portfolio
To what extent can foreign investment and international expertise help advance the development of Libya’s insurance sector?
ALRAGAE: Foreign participation can serve as a key catalyst for the sector’s growth. Libya’s insurance market stands to benefit significantly from international investment– especially from mature markets that offer technical depth, reinsurance capacity, and innovation in products and processes. Advanced players bring with them institutional know-how that can strengthen areas such as underwriting, risk modelling, and claims management. In particular, access to international reinsurance is essential, given the capital-intensive nature of insuring infrastructure, healthcare, transport, and energy projects. However, attracting such investment hinges on the availability of a stable political environment, a clear and enforceable legal framework, and tangible investor protections. When these fundamentals are in place, Libya’s insurance sector offers the potential for healthy returns on equity and long-term growth prospects.
What measures are being taken to develop specialised segments such as health, takaful, and microinsurance?
ALRAGAE: The diversification of Libya’s insurance portfolio is gradually taking shape, with specialised lines gaining traction. Health insurance continues to draw interest, particularly as the public seeks alternatives to overstretched state services. Similarly, takaful has strong potential in a country where demand for Sharia-compliant financial services remains high. Microinsurance is another emerging area, particularly relevant in efforts to extend coverage to underserved segments of the population. Technical working groups within the sector have been instrumental in examining global models and adapting them to local realities. Progress in these areas may appear incremental, but the foundation for a more inclusive and diversified insurance offering is steadily being laid.
How can insurance penetration be improved, and what role does public awareness play in that effort?
ALRAGAE: Raising awareness about the value of insurance is essential to boosting penetration, which remains low by regional and global standards. Building public trust requires ongoing engagement with individuals and businesses alike. Educational campaigns, industry forums, and stakeholder dialogues have helped introduce insurance concepts to new audiences. A pivotal turning point is expected once a new comprehensive insurance law is passed. Among other provisions, it is likely to make certain forms of coverage compulsory, thereby expanding the insured base. Compulsory lines– if implemented effectively– could shift market dynamics significantly, encouraging uptake while also improving risk pooling and sector resilience.
What efforts are underway to strengthen professional standards in areas like claims handling, customer service, and digital innovation?
ALRAGAE: Raising service standards is increasingly seen as a competitive imperative. Insurers are being encouraged to view prompt and fair claims settlement not just as an obligation, but as a key branding tool. Strong after-sales service and customer engagement are emerging as differentiators, particularly in a market where trust must be earned over time. On the digital front, transformation remains a strategic priority. Plans are underway to introduce sector-wide initiatives that make the adoption of insurtech solutions more accessible. Collaborative training, knowledge sharing, and joint procurement of digital platforms are among the tools being explored to reduce costs and promote sector-wide alignment. These efforts aim to modernise operations and enhance customer experience, while also preparing firms for the evolving digital economy.
This interview serves as a preview of the in-depth analysis coming in The Report: Libya 2025.
Read More from OBG
