In recent years, Saudi Arabia’s insurance sector has shown strong premium, revenue, asset and equity growth. With a new insurance law on the way as of January 2026, the sector continues to both widen and deepen, while hosting two of the Middle East’s largest insurers: Bupa Arabia and Tawuniya. At the same time, Saudi Arabia is home to the world’s largest sharia-compliant insurance, or takaful (Islamic insurance) market.
There has already been significant restructuring of industry supervision with the 2023 establishment of the Insurance Authority (IA) consolidating two previous sector entities. Operating since 2024, the IA now brings together all regulatory aspects of the sector, from health insurance to reinsurance, and motor policy standards to capital requirements. In addition, the insurance sector has benefitted from the priority given by the Saudi authorities to finance industry development under the Kingdom’s long-term economic diversification plan, Vision 2030. The Financial Sector Development Programme (FSDP) sets targets for further expansion of mandatory coverages, health care reform, the use of new technologies, and localisation in insurance and reinsurance issuers. Industries such as tourism are growing rapidly, as is the adoption of new technologies. All of these steps bode well for future expansion, as well as efficiency and security.
Simultaneously, challenges include furthering policy penetration and boosting profitability while negotiating the rapidity of international investment flows. At a time of global uncertainties, a strong regulatory framework is a pre-requisite for success, along with a depth of experience in dealing with both local and international markets. On both of these counts, the Kingdom’s insurers look well placed, with a strong 2026 forecasted as they leverage Saudi Arabia’s project and investment growth to further develop their business.
Structure & Oversight
Until the creation of the IA, supervision of the sector was managed by two different entities: the Saudi Central Bank and the Council of Health Insurance (CHI). The IA brings the insurance responsibilities of these two together in a single authority reporting directly to the prime minister. For its part, the IA has responsibility for regulating, supervising and monitoring the sector; and enhancing its competitiveness, product diversity and standards of service. Furthermore, the IA issues and removes insurance sector licences in the Kingdom. In January 2023 Saudi Arabia adopted International Financial Reporting Standard (IFRS) 17, which by January 2026 had been rolled out across the sector, replacing IFRS 4. This made the Kingdom one of the first countries to operate under the framework, making market entry much more straight forwards for international insurers already working to IFRS 17. In November 2025 the IA announced that the Kingdom would start transitioning from its current solvency regime to a risk-based capital (RBC) regime in 2026. After a year in which both systems will operate in parallel, the full implementation of RBC will then follow in 2027.
New Regulations
In 2025 a draft insurance law was released for public consultation to replace the 2003 Law on Supervision of Cooperative Insurance Companies, the insurance-related provisions of the 1999 Health Insurance Law, and parts of other regulations. Once enacted, it is expected to require Saudi-headquartered operations; full separation of reinsurance from general and life insurance; new governance and foreign activity rules; capital requirements; and increased IA oversight of brokers, agents, and outsourcing. Additionally, it will comprehensively regulate subrogation, dispute resolution, complaints, enforcement and IT use. Consultation ended in July 2025, and the sector awaits the final law as of early 2026.
In November 2025 the IA proposed a new amendment to existing rules on timelines for settling claims. Should the proposal be adopted, insurers will be required to process claims within five days of the date they receive all the necessary documents, rather than the current 15, while compensation must be paid within two days after claims processing is completed. For corporate and commercial claims, the maximum settlement period would be 45 days. Some flexibility would be allowed if companies are able to make a compelling case, but otherwise, the IA hopes that such a rule will help boost customer confidence in the insurance sector and enhance transparency.
Since Royal Decree No. (M/32) of 2003, Saudi-licensed insurers and takaful companies operate according to a cooperative model. This means that the contributions of all policyholders are considered donations to a mutual fund managed according to sharia principles. Investment activities must therefore avoid interest, gambling or excessive uncertainty, while surpluses generated can be either returned to participants or donated to charity. This structural requirement gives the Saudi insurance market a different character to other regional markets, where both conventional and Islamic insurance practices are maintained, usually by clearly separated companies. In Saudi Arabia, all domestic insurers operate under the same Islamic cooperative principles, giving sharia-compliant assets a 100% share of the market. In other leading GCC insurance markets such as the UAE, for example, takaful accounted for 6.9% of total insurance assets in the third quarter of 2024, according to the international standards authority, the Islamic Financial Services Board (IFSB).
As with all sectors of the economy, insurance is subject to the Kingdom’s Saudiisation policy, which sets a ratio of Saudi nationals to foreign nationals for each industry. The insurance sector has made progress against this goal in recent years, with the rate rising from 75% in 2023 to 84% in 2024, according to the IA. Within the sector, this was divided into an 88% ratio for non-managerial positions and 70% for managerial ones. The authority reported that in the same year, some 11,466 people were employed in the sector – up from 10,623 in 2023. Saudiisation is increasingly a requirement when establishing a business. In January 2025 a 2022 instruction from the central bank came fully into force that requires all insurers operating in the Kingdom to offer at least 30% of their reinsurance business to locally licensed reinsurers.
Financial Vision
Launched in 2018, the Vision 2030 FSDP highlights the insurance sector as a key pillar of the Kingdom’s plans to develop its local non-oil economy. Indeed, the FSDP 2020-25 programme charter describes the sector as one of the most important financial services that supports all other economic activities and maintains their stability. The FSDP is divided into phases, with 2025 seeing the completion of phase two and phase three under way. The plan established key performance indicators (KPIs), including significantly raising the contribution made by gross written premium (GWP) to non-oil GDP to 4.3% by 2030. The phase two KPI target was 2.4% by 2025. These targets represent significant sectoral growth, as GWP constituted around 1.9% of non-oil GDP in 2019.
Health insurance is seen as a central pathway to achieving these KPIs, with coverage targeted at 45% by 2025. Health insurance is now compulsory for foreign nationals and those working in the private sector, and must be obtained from a list of approved providers published by CHI. In December 2025 this rule was tightened to require such policies be obtained before the issuance of any temporary work visas.
This broader strategic direction was also reflected in November 2025 with the launch of the Ingate Global Insurance Conference and Exhibition in Riyadh, a regulator-led platform intended to support Saudi Arabia’s positioning within regional and international insurance dialogue in line with Vision 2030.
Key Segments
A programme to combat fraudulent health insurance coverage is included in the phase two goals. Mentioned among these is the strengthening of the motor insurance segment, with a goal of 77% coverage set for 2025. “The motor line experienced a sharp expansion in late 2023 due to stricter enforcement of mandatory coverage but this effect normalised quickly,” Umar Al Mahmoud, CEO of Saudi-based insurance provider MedGulf, told OBG. “In 2025 the number of insured vehicles remained broadly stable, yet pricing dropped substantially due to competition among more than 20 active players.” Expanding motor insurance, an often low-margin segment, is key to reducing costs and thus improving the segment’s cost-to-income ratio. In addition, the reinsurance segment is being strengthened, with the ruling mentioned above requiring at least 30% of insurers’ reinsurance business being offered to local reinsurers part of that drive. Furthermore, a wider initiative to boost the localisation of insurance is under way, supporting an increase in foreign direct investment within the Kingdom.
Life insurance partnerships with government entities are being encouraged under the FSDP, as it aims to increase penetration of the protection and savings segment – the local, sharia-compliant version of life. Insurance as a premier risk management product is being advanced, with awareness and governance capacity-building initiatives. The development of a clearer, more effective means of calculating zakat (a payment under Islamic law that is used for charitable or religious purposes) is also being pursued by the IA.
At the time of writing, the results achieved by phase two of the FSDP were still being determined, but some KPIs had already been achieved before end-2025. Speaking at the Global Insurance Conference and Exhibition in Riyadh in November 2025, Abdulaziz Al Boug, IA chairman and governor of the General Organisation for Social Insurance, said the sector had contributed 2.6% of non-oil GDP in 2024 – ahead of the 2.4% target for 2025 – after showing 17% growth that year. Similarly, the IA moved in the first half of 2025 to launch a dedicated health insurance compliance platform. This provides real-time data on policy coverage, streamlining employer obligations and aligning workforce protection standards. A review began of health insurance pre-authorisation requirements to streamline processes, removing unnecessary delays in approvals.
Sector Players
In terms of GWP, the sector’s largest companies in the first six months of 2025 were Bupa Arabia, with SR12bn ($3.2bn), and Tawuniya, with nearly SR12bn ($3.2bn). The two companies combined accounted for more than 50% of the sector’s total GWP during that period, with the former taking a 27.3% share and the latter a 26.8% share. The third-largest insurer in terms of GWP during the same period was Al Rajhi Takaful, with SR5.2bn ($1.4bn), comprising an 11.6% share; followed by MedGulf, with SR2.8bn ($739.6m), at 6.2%; and Saudi Re, with SR2.1bn ($557.2m) and 4.7%.
There were 21 companies active in the Kingdom in the first six months of 2025, with GWP shares of between 0.1% and 2.8%, indicating a significant number of small and medium-sized insurers and potential for future consolidation in the market. Indeed, in June 2025, two mid-market outfits, Salama Cooperative Insurance, with 0.6% of total sector GWP in the first half of 2025, and Saudi Enaya, with 0.1%, were given permission to merge by the General Authority for Competition. Meanwhile, in July 2025, MedGulf announced a binding merger agreement with Buruj Cooperative Insurance, which held a 0.8% share of total GWP during the first half of 2025.
Comparing the first half of 2025 GWP market ranking with the first half of 2024, there was no change among the four largest providers, although Saudi Re moved into fifth place from sixth in the first half of 2024, while Walaa Insurance dropped from fifth to seventh. Saudi Re’s performance was improved in part due to the new ruling that domestic insurers should offer 30% of their reinsurance business to locally licensed reinsurers. The company received an injection of capital from the Kingdom’s sovereign wealth fund, the Public Investment Fund (PIF), in January 2025. The PIF acquired a 23.1% stake in Saudi Re via a capital increase that month, helping secure the reinsurer as a sound base for local insurers’ reinsurance needs.
Using total assets as a guide for ranking, four of the five largest insurers in the first two quarters of 2025 were the same, but in a slightly different order. The largest was Tawuniya, with SR21.3bn ($5.7bn), followed by Bupa Arabia with SR16.8bn ($4.5bn). Al Rajhi Takaful with SR13.7bn ($3.7bn), Walaa Insurance with SR4.3bn ($1.1bn), and Saudi Re with SR4.1bn ($1.1bn). Arabian Shield was in sixth at SR4.1bn ($1.1bn), followed by Al Jazira Takaful with SR3.1bn ($822.5m). MedGulf’s total assets were SR3.1bn ($815.8m), the eighth-largest in the industry. In terms of brokerages, there is a major concentration of business among the largest players. In 2024 the top-10 brokerages accounted for 73% of the brokerage GWP market, with some 69 others accounting for the remaining 27%, according to the IA.
The Saudi insurance sector is dominated by non-life lines. Figures from the IA show that the sector’s total GWP was SR20.3bn ($5.4bn) from January-September 2025. Life insurance – categorised as protection and savings – constituted SR2bn ($533.2m), or around 10% of the total. Given the sharia-compliant cooperative structure, Saudi Arabia’s takaful sector has consistently been among the largest in the world. According to the IFSB, some 40% of all global takaful contributions were accounted for by the Kingdom in 2019.
Performance
While recent years have seen general, protection and savings, and health insurance maintain similar shares of the total Saudi market, the overall size of the sector has grown substantially. According to a 2025 KPMG report on the industry, in 2019 health insurance accounted for 59.3% of total GWP, general insurance 37.7%, and protection and savings insurance 3%. Four years later, in 2023, the respective figures were 59%, 37.1% and 3.9%. However, over the same period, GWP for health grew by 71.9%, from SR22.5bn ($6bn) to SR38.6bn ($10.3bn); for general by 69.9%, from SR14.3bn ($3.8bn) to SR24.27bn ($6.5bn); and for protection and savings by 126.1%, from SR1.1bn ($301.3m) to SR2.6bn ($685.2m).
GWP overall continued to increase in 2024. IA figures show health at SR42.2bn ($11.3bn) for that year, general at SR26.2bn ($7bn), and protection and savings at SR7.7bn ($2.1bn). The bulk of the general insurance GWP was accounted for by motor, with SR13.9bn ($3.7bn), followed by property, with SR2.9bn ($773.1m); and engineering, with SR2.9bn ($767.8m).
Figures from January-September 2025 show these trends broadly continuing. IA figures give the sector’s total GWP at SR65.2bn ($17.4bn) in the first nine months of 2025, up 11.7% from the SR58.3bn ($15.6bn) recorded between January-September 2024. As of the third quarter of 2025 figures show GWP at SR20.3bn ($5.4bn), up from SR18.5bn ($4.9bn) in the second quarter of 2025. In terms of lines of business, health continued to dominate, with 52.6% of total GWP in the third quarter of 2025 – or SR10.7bn ($2.8bn) – followed by motor, with 21%, or SR4.3bn ($1.1bn), while protection and savings took a 9.7% share, or SR2bn ($522.5m).
On a year-on-year (y-o-y) basis, protection and savings’ share of GWP declined, from 13% and SR2.4bn ($639m) in the third quarter of 2024. In contrast, health and motor segments both grew over the same timeframe, from shares of 50.4% and 20.2%, or SR9.3bn ($2.5bn) and SR3.7bn ($994.4m), respectively. Insurance revenue rose over that period. In the first nine months of 2024, insurance revenue was SR52.1bn ($13.9bn), while for the corresponding period in 2025 it was SR53.5bn ($14.3bn), a 2.8% increase. Several other indicators recorded declines. Net investment income contracted by 25.2%, insurance service results dropped 35.8%, and income from other sources decreased 75.9%, contributing to a 47.8% y-o-y fall in net income after zakat and tax. These trends reflected volatility in global investment markets not weakening domestic activity, as GWP continued to rise. The retention ratio edged down from 85.4% in the third quarter of 2024 to 84.2% a year later; health and motor retention increased to 98.9% and 99.2%, up from 97.7% and 99%, respectively.
The reinsurance segment of the Saudi market showed growth in 2024-25 with the entrance of a new domestic player, Riyadh Re. Launched by Tawuniya, the IA gave the new outfit its licence in November 2025, armed with capital of SR550m ($146.6m) and an “A-” credit rating from Standard & Poor’s Global. The company joins Saudi Re as the Kingdom’s second-largest major reinsurer, with both well placed to capitalise on the recent changes in regulations to compel more reinsurance business to local providers. Consolidation and further professionalisation of brokerages and agencies continued in 2025, with the IA revoking the licences 28 firms as part of broader efforts to protect policyholders and strengthen stability and credibility.
Digital Transformation
The FSDP sees financial technology as a key pillar in the sector’s growth, with the insurance sector branch of this – insurance technology (insurtech) – thus fulfilling a double goal of the programme. Insurtech adoption has been driven by both regulatory initiatives and market necessities, as digital transformation brings major benefits to efficiency and ease of doing business for the customer. In 2023, the Saudi Central Bank mandated that all insurers must adopt digital platforms for claims processing and policy issuance. Regarding efficiencies and customer services, so far, the fields of price aggregation and motor insurance have seen the most use of insurtech in the Kingdom, with these relatively straightforward to digitise. Indeed, figures from the Mohammed bin Salman Foundation show that online brokers had already captured 5.6% of the sector’s GWP by 2021, channelling around 30% of all motor insurance policies that year.
In terms of more complex market segments such as health, progress has been slower – with a hybrid system of online tech and manually filed case studies, applications and other data in operation. This presents an opportunity for further insurtech development. Another area for insurtech is in smaller insurance policies, such as travel and pilgrimage, with mobile applications providing quick ways to obtain coverage. Indeed, the Kingdom is seeing new entrants into insurtech. One of the most recent was Abu Dhabi’s insurtech outfit Shory Group, which gained IA approval to start working in Saudi Arabia in November 2025.
Outlook
The unveiling and implementation of the new insurance law may lead to significant shifts in the sector in the period ahead as sector players adjust their working practices. The impact of insurtech will also continue to make itself felt, disrupting traditional retail segments, in particular. Meanwhile, the Kingdom’s vast range of mega- and giga-projects continues to roll out, with the opportunities for insurers expanding with them. Many of these projects are highly complex, meaning that the expertise of international insurers, as well as local, will continue to be required. The health industry is poised to benefit from further obligatory requirements as well, with health insurance becoming increasingly mandatory. Locally based reinsurance could see growth due to regulatory initiatives. Saudiisation and localisation benefits the sector’s long-term outlook, as knowledge and expertise is developed and concentrated in-country. While regional and international developments remain uncertain – along with the price of oil – Saudi Arabia’s relatively large domestic population and growing non-oil economy is anticipated to give its insurance market key depth in the period ahead.
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