IA outlines features of National Insurance Strategy

Abdulaziz Al-Boug, Chairman of the Insurance Authority (IA)

Chairman of the Insurance Authority (IA), Abdulaziz Al-Boug, said the newly-approved National Insurance Sector Strategy was built to unlock the Saudi insurance sector’s potential and transform it into one of the world’s fastest-growing and most advanced insurance markets.

Commenting on the Saudi Cabinet’s approval of the strategy today, he said that the National Insurance Sector Strategy seeks to achieve three strategic objectives:

· Enhancing insurance protection for individuals and the business sector.

· Developing a sustainable and efficient insurance market.

· Enabling and providing insurance coverage for national risks.

The authority will work in cooperation with partners and stakeholders to achieve these strategic objectives based on several key pillars and enablers. These include 11 strategic and enabling programs aligned with the objectives, and 72 initiatives linked to these programs. Together, they will contribute to achieving 9 strategic promises aligned with the targets of Saudi Vision 2030 and represent the most important expected outcomes.

The programs include the following:

1. Health insurance

2. Motor insurance

3. Property and casualty insurance (individuals)

4. Protection and savings insurance

5. Property and casualty insurance (corporates)

6. Reinsurance

7. Retention and capacity

8. Uninsured risks

9. Regulations and legislation

10. Technology, data, and artificial intelligence

11. Human capital

Among the most notable promises are increasing the size of the insurance market, raising insurance penetration to 3.6% of GDP by 2030, doubling risk-based capital, increasing retention rates in property and casualty insurance, expanding health insurance coverage to 23 million beneficiaries, increasing the number of insured vehicles to 16 million, and raising the number of jobs available to national talent in the insurance sector to 38,500 positions.

Strategy Initiatives

The National Insurance Sector Strategy aims to achieve its strategic promises and other targets through the implementation of 72 initiatives linked to the strategic and enabling programs. Each initiative is tied to a specific strategic objective and complements the others. The strategy has defined the details of the initiatives and prioritized them, aiming to develop all areas of insurance and deliver a transformative impact on the entire insurance sector landscape.

Strategic Program Initiatives – Health Insurance

To achieve the targets of the Health Insurance Program, 11 initiatives have been approved to develop the health insurance market, expand voluntary insurance programs, enhance the effectiveness of mandatory implementation, promote innovation and sustainability, and raise beneficiary satisfaction levels. These initiatives also aim to promote responsible consumption of healthcare services, reduce fraud, waste, and misuse, enhance employers’ ability—particularly SMEs—to bear insurance costs, expand vertical integration by improving the regulatory framework through removing regulatory barriers, introducing new regulatory tools, and establishing a sustainable governance system.

Strategic Program Initiatives – Motor Insurance

The National Insurance Sector Strategy has identified 9 initiatives to achieve the objectives of the Motor Insurance Program. These focus on developing a data base that enhances pricing efficiency to ensure fair pricing for beneficiaries while maintaining market stability and sustainability. The initiatives also aim to increase the adoption of driving behavior assessment technologies (telematics), enable insurers to design innovative products and solutions, improve claims management, and enhance operational efficiency and technical capabilities, including underwriting processes.

Strategic Program Initiatives – Property and Casualty Insurance (Individuals and Corporates)

The strategy plans to implement 17 strategic initiatives related to property and casualty insurance for individuals and corporates. These initiatives aim to establish a central system for storing policyholder data to support informed decision-making by insurers, create an environment that enables companies to succeed, increase retention rates, and enhance risk-bearing capacity. They also focus on building technical capabilities and skills, establishing a regulatory framework that facilitates the attraction and establishment of restricted-activity insurance companies, and enabling consumers to obtain suitable insurance protection while facilitating access through appropriate distribution channels.

Strategic Program Initiatives – Protection and Savings Insurance

The strategy has identified 12 initiatives for the Protection and Savings Insurance Program, which will play a vital role in financial education and raising awareness of the benefits of protection and savings insurance. The initiatives include creating financial incentives to build trust and increase demand, establishing an insurance pool to protect policyholders’ savings, encouraging insurers to offer innovative products, and promoting financial inclusion. They also encourage employers—particularly SMEs—to offer institutional savings programs or defined contribution plans for employees as a complementary pillar to existing pension systems.

Strategic Program Initiatives – Reinsurance, Retention, Capacity, and Uninsured Risks

Under these strategic programs, 10 initiatives are planned to achieve several objectives, most notably enabling local reinsurance companies to expand into global markets, increasing local reinsurance volumes, enhancing available capital for reinsurance activities, and developing national talent to support the expansion of reinsurance underwriting and attract specialized expertise.

These initiatives will also help update and review relevant regulations to enhance the attractiveness of the reinsurance market, improve market maturity and data availability, and address uninsured national risks through the establishment of the first insurance pool to provide appropriate coverage and strengthen private-sector participation in risk management, thereby increasing protection levels and reducing the burden on public finances.

Strategic Program Initiatives – Technology, Data, and AI

Achieving the objectives of the Technology, Data, and AI Program requires the implementation of five initiatives to modernize and unify digital infrastructure, enhance innovation, and accelerate the adoption of modern technologies in the insurance sector.

The initiatives also include developing a data and AI strategy to ensure data quality, enable advanced analytics, enhance collaboration through secure information-sharing frameworks, and establish a centralized and secure insurance sector database. Additionally, they aim to raise digital standards, data protection, and cybersecurity levels within the insurance sector.

Strategic Program Initiatives – Human Capital

The National Insurance Sector Strategy places significant emphasis on human capital as a key enabling program. It has identified six initiatives to achieve its objectives, including enhancing public awareness and insurance knowledge among youth, leveraging partnerships with schools, private entities, and insurance companies to integrate insurance concepts into school curricula, addressing labor market needs through a comprehensive workforce development ecosystem, providing incentives and specialized professional training programs, and strengthening partnerships with academic institutions, regulators, and industry leaders to align skills with market needs.