Mr. Yassir Al Baharna
Chief Executive Officer - Arab Insurance Group (ARIG)




1. What is your outlook on the state of the regional economy? When will we start to see recovery?

The direct effects of the financial crisis experienced by most economies in the region have been relatively mild, as in general the financial institutions in the region were not large holders of subprime mortgage-backed securities. That said, there have still been indirect effects. The recent improvement in global financial conditions and rise in commodity prices, however, are helping restore the pace of economic activity. As per IMF report (October 2009), Gulf economies together are projected to grow 5.2% in 2010 against a projected real growth of 0.7% their combined GDP in 2009. I therefore, believe that the stage is well set for a regional recovery next year.
Bahrain, in particular, is well placed even this year. The projected GDP growth for the country in 2009 is 2.6%. Our diverse economy has enabled us to achieve this even in the worst global economic downturn in almost 80 years.

2. What is your outlook on the Bahrain insurance market, and the new compulsory medical insurance law proposed?

The insurance industry in Bahrain has been growing steadily and strongly in recent years demonstrating double digit growth, mirroring the expansion of Bahrain’s financial sector. Despite the recent financial turmoil in the financial sector, the insurance market in Bahrain experienced annual premium growth in 2008 of 34%. Growth has continued in 2009: first half year figures show a 9% growth compared to the same period last year.
Looking specifically, Medical is one segment of the Bahrain insurance market which is showing consistent growth as it provides an ideal alternative healthcare financingand protection instrument. This is being driven largely by 2 factors:
• The economic downturn and a the resulting need to contain costs, and
• A growing availability of quality private healthcare providers in the country

We understand from our recent discussions with the Ministry of Health that the Draft Laws related to the implementation of the Compulsory Medical Insurance for expatriates in Bahrain is awaiting approval by the Parliament. There is a keen interest by the Ministry to make progress on implementing this, once all parties involved (insurers, reinsurers and health care providers) are ready, and preparatory initial steps are already being taken.

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