Interview: Naji Al Tamimi, CEO, Insurance Authority
What is the outlook for the Saudi insurance market, and what is the role of the Insurance Authority?
NAJI AL TAMIMI: The government’s commitment to the industry led to the creation of the Insurance Authority in August 2023. This shift in oversight from the Saudi Central Bank and the Council of Health Insurance to the new body is expected to allow for a more strategic focus on the sector. As the industry’s sole regulatory body, the authority is developing a comprehensive strategy, and setting future goals and targets.
How are insurance companies adapting to emerging market segments and evolving demand patterns?
AL TAMIMI: Economic entities and private sector companies always take supply and demand into account. They possess the agility to navigate these variables accurately to ensure growth and continuity. Insurers have been actively engaging in sessions to discuss challenges and stay informed about forthcoming developments. These engagements with the regulator aim to pave the way for a promising and sustainable market that is characterised by expansion, greater investment and enhanced financial efficiency among sector players.
To what extent has recent global economic volatility affected the demand for insurance in Saudi Arabia?
AL TAMIMI: Undoubtedly, these fluctuations impact all industries, including insurance. However, what makes the sector stand out is its adaptability, as it possesses the flexibility to realign and adjust. With Saudi Arabia’s ongoing economic transformation and expansion under way, the demand for insurance continues to rise.
Consequently, the insurance sector requires a robust regulatory framework and streamlined processes to match the scale of this economic shift and the proliferation of major projects. This, in turn, calls for greater innovation and the development of dynamic products that are tailored to support this growth, as well as amplify the sector’s contribution to non-oil GDP.
Where do you see opportunities for digital tools to enhance insurance penetration in the local market?
AL TAMIMI: We find ourselves in the midst of a revolution in digital technology and artificial intelligence (AI), shaping the landscape of various industries. Insurance stands out for its unique and rapid advancement facilitated by these technologies. Given its reliance on people and data, it has adapted to harness the potential of digitalisation and AI, resulting in enhanced efficiency in processing insurance claims and delivering superior customer service at a faster pace than ever before.
The Kingdom benefits from its robust digital infrastructure. Building upon this, the launch of the AI Ethics Framework by the Saudi Data and AI Authority underscores the country’s commitment to its vision and national strategies, which set forth essential principles such as transparency, fairness, accountability and the delivery of social benefits. This ensures the responsible adoption of AI across various sectors.
In what ways does the regulatory framework for insurance in Saudi Arabia influence insurance penetration, fraud mitigation and risk management?
AL TAMIMI: We are dedicated to the constant development of the insurance sector. The aim is to establish a sustainable market aligned with global best practices, with a fair regulatory framework that ensures the protection of stakeholders’ rights while fostering growth and stability. Efforts are being made to create an environment conducive to attracting investment and developing expertise within the industry. Moreover, societal awareness of the significance of insurance and its role in mitigating risks has notably matured.
To address the risk of fraud and enhance the management of such dangers, the Kingdom is enacting robust legislation to oversee and regulate the sector effectively. Collaborative efforts with relevant authorities involve continuous coordination and extensive data analysis to identify and combat fraudulent activities.
Read More from OBG
