[1]<\/a><\/sup> in 2017 and is growing every year. Much of this growth is still focused on providing protection to individuals and families, but business insurance is predicted to be a major growth sector as awareness and expectations continue to develop.<\/p>\n![\"\"](\"https:\/\/alj.com\/app\/uploads\/2019\/06\/ShadowPP-ALJ-Jeddah-9283.jpg\")
<\/p>\n
Against this background, Abdul Latif Jameel Insurance is set to be a key player in the country\u2019s growing insurance and risk sector, helping to transform understanding and demand for a wide range of business insurance and risk advisory services.<\/p>\n
Originally set up on an agency model, in partnership with global insurance heavyweight Axa, Abdul Latif Jameel Insurance launched an innovative new brokerage business in 2018.<\/p>\n
Opening Doors<\/em> caught up with the CIO for Abdul Latif Jameel Insurance Brokerage Company, Nolwen Allano, to discuss the Saudi Arabian insurance market and the business\u2019s ambitions for the future.<\/p>\n![\"Nolwen](\"https:\/\/alj.com\/app\/uploads\/2019\/06\/FA14-fullwidth3.jpg\")
<\/p>\n
Q: How do you assess the current status of the Saudi Arabian insurance market?<\/strong><\/p>\nA: Historically, the market has been focused on individuals and protecting the vital assets of individuals. \u00a0So about 80% of premiums have come from motor insurance and health insurance. \u00a0These tend to be highly commoditized and customer service levels and claims management are often poor.<\/p>\n
On the other hand, there has not been the same understanding or awareness of the need to protect business assets – for example, very few businesses have business interruption insurance, or even understand what it is. \u00a0This is where Abdul Latif Jameel Insurance has a key role to play, acting not as a transactional supplier but as a trusted advisor in a long term relationship with our clients.<\/p>\n
Q: How do you expect it to develop over the next few years?<\/strong><\/p>\nA: There are around 50 insurance brokerages in Saudi Arabia, but they tend to be very transactional and price-focused, partly due to the products and to client expectations. \u00a0We aim to help change this.<\/p>\n
In this market, we need brokers to act in a more advisory capacity, raise awareness of products, and to educate clients about risks they may face and the products available to mitigate<\/em> those risks, not to just find the lowest price. \u00a0This includes developing reinsurance, InsureTech and other products to stimulate the market.<\/p>\nMore importantly, it also includes a journey to educate businesses to rethink their attitude to risk.<\/p>\n
Q:<\/strong> What does the launch of the brokerage business mean for Abdul Latif Jameel Insurance?<\/strong><\/p>\nA: We still operate our agency business, too, but we believe that a brokerage model is more suitable for business insurance. \u00a0As an agency tied to one insurer, you can only offer that\u2019s insurer\u2019s products and policies to your clients. \u00a0That might work well in the short term, but as your client\u2019s business grows, its risk profile changes, which means that the particular insurer may no longer be the best fit.<\/p>\n
As a broker, we can work with our clients to deeply<\/em> understand their business and their risks, and scour the market to meet this challenge and find the insurance products that best fit their commercial needs.<\/p>\nQ: How will you do that? \u00a0What are your main responsibilities in your role as Group Chief Insurance Officer at Abdul Latif Jameel?<\/strong><\/p>\nA: We are a different kind of broker with a unique position in the market. \u00a0We go to visit the prospective client, we talk to them about their business and their plans for the future. \u00a0We ask the right questions so we can understand the risks and identify the critical areas that need protection.<\/p>\n
As I said earlier this is about thinking differently with our business clients.\u00a0 It\u2019s a different way of doing things. \u00a0During our first year, we focused on establishing our business and starting to build relationships. \u00a0And it is working. \u00a0In the second year, we aim to raise our profile and showcase our credibility and our experience. \u00a0We\u2019ll be holding a number of events, starting with our cyber risks seminar in March, to help get the message out that businesses need to understand these risks and take measures to mitigate them.<\/p>\n
We want to be the first insurance brokerage to explain to corporate customers what risks they face and what they can do about it. \u00a0We want our clients to think about insurance as business collateral.\u00a0 Once you have identified and quantified your risk, you can ensure it and outsource it.\u00a0 This is a catalyst, a powerful enabler for the business to take more risk and invest more, stimulating growth and the economy knowing that the downside of some of this is already insured against.<\/p>\n
Q: Why did you focus on cyber risks for your first seminar?<\/strong><\/p>\nA: Ten years ago, if you were a risk adviser in the business insurance sector, your main focus was providing risk mitigation for threats such as fire, floods, theft, with the potential impact on a business of between six and 24 months.<\/p>\n
While these types of risks are still important, in recent times they have been overshadowed by the emergence of a new type of threat \u2013 the cyber threat.<\/p>\n
The statistics are truly alarming. Every 39 seconds a cyber attack takes place somewhere in the world. The annual cost of cyber-crime is estimated at more than US$ 600 billion, surpassing the global cost of natural disasters, which stands at approximately US$ 400 billion.<\/p>\n
![\"Saud](\"https:\/\/alj.com\/app\/uploads\/2019\/06\/FA14-fullwidth1-1.jpg\")
<\/p>\n
Driving this threat is the rapid adoption of technology, the so-called \u2018digital transformation\u2019. Data is the new cash. We no longer see bank robberies like in the old days. In fact, physical bank robberies have dropped by 90% over the last 20 years in Europe.<\/p>\n
The digitization of business can bring huge benefits to organizations. But we mustn\u2019t forget that with technology comes risk. Technical failures relating to critical systems, malicious attacks, ransomware, and data breaches: these are just some of the threats we face.<\/p>\n
Inadequate responses to these threats may result in consumers losing confidence and the businesses losing revenue. It is a threat that businesses simply cannot<\/em> afford to ignore, and there is a range of insurance products that can help to protect them. So we thought it would be ideal for a first seminar.<\/p>\n
![\"\"](\"https:\/\/alj.com\/app\/uploads\/2019\/06\/insuretech.png\")
With rapid technology-driven innovation fuelling the financial services and insurance sector globally, these FinTech and InsureTech developments may be ripe to power growth in the Middle East.<\/p>\n