FGB tackles underinsurance levels and supports growth of insurance sector
In response to high levels of underinsurance in the region, where life insurance in particular has one of the lowest penetration rates of any emerging market, First Gulf Bank (FGB), one of the leading banks in the UAE, has announced the launch of a new ‘Insta’ product range from its Bancassurance department.
This has been developed in conjunction with MetLife Alico, a leading global provider of life insurance solutions, to promote the importance of insurance coverage amongst residents and help customers plan for the future. Customers can enroll in any of the two new products, Insta Protect Plus and Insta Care (Critical Care), instantly, by providing minimal documentation and without having to undergo any medical tests.
Safeguarding the financial security of the policy holder’s family, Insta Protect Plus covers any unpaid financial liabilities, such as a loan, to ensure the family of the insured does not struggle to pay the outstanding debt in the unexpected event of loss of life of the policyholder. Additionally, the plan offers return of 50% of total premium paid upon maturity, if the protection element of the product is not used during the term of the plan. Insta Care (Critical Care) introduces a new concept in health protection and provides customers with an instant lump sum to help them pay for expensive medical bills or compensate for the loss of income due to a critical illness.
Girish Advani, Head of Mass Market Segment at FGB, said: “Many people understand the importance of protecting themselves against the unexpected however some consider the process to obtain cover as inconvenient and expensive. As such, we’ve developed the Insta product line with MetLife Alico, keeping customer convenience and affordability firmly in mind, as part of a strategy to tackle the high level of uninsured or underinsured people within the UAE and the region. The new products will help to raise awareness about how vital insurance coverage really is and encourage UAE residents to start planning for their future”
Statistics have proven that though recent years have seen robust insurance sector growth in the Gulf region, insurance penetration is much lower than the world average, particularly when it comes to life insurance. Figures from global reinsurer Swiss Re have revealed that life insurance business accounts for only 14% of premiums in the region, whist insurance in western markets, is split 58:42% between life and non-life business. The UAE has the largest insurance market in the GCC, accounting for 44.1% of the region’s Gross Written Premium in 2012, but is still primarily driven by non-life premiums, which account for the vast majority of insurance business in the country.
Mr. Advani continued: “The insurance sector in the region, and particularly the UAE, has grown considerably in recent years, but remains underdeveloped and behind the world average by a large margin. Insurance penetration in 2012 for example, was at 1.1%, close to one-sixth of the global average. The UAE has made significant strides in the development of its insurance sector, which expanded at an annual average growth rate of 9.6% between 2008 and 2012, reaching a value of USD 7.2 billion. However, much of this growth is due to compulsory covers and the UAE insurance market is still heavily weighted towards non-life insurance.”
The new FGB ‘Insta’ product range will help the bank to meet the diverse needs of UAE – residents and enable customers to ensure the financial security of themselves and their loved ones. Insta Protect Plus and Insta Care (Critical Care) are both available to customers and the third product, Insta Save, will be launched soon. This launch follows FGB’s recent campaign – during the Dubai Shopping Festival where it provided complimentary jewellery and home contents insurance cover of Dhs70,000 to raise awareness about the importance of home insurance to UAE residents.