S&P Global Ratings projects that the Islamic insurance market in the Gulf Cooperation Council will continue to develop at a rate of about 10% per year in 2025 and 2026, driven by infrastructure spending, population growth, and regulatory improvements.
According to S&P’s most recent white paper, Saudi Arabia, the biggest Islamic insurance market in the region, will keep expanding as the demand for coverage is fueled by Vision 2030 megaprojects. Takaful, or Islamic insurance, has grown quickly throughout the GCC in recent years, with growth rates of 24 to 28 percent in 2022 and 2023. The sector’s growth has been aided by strong government support, laws requiring health insurance, and growing consumer awareness of financial goods that adhere to Sharia.
“We anticipate 2025 to be another year with strong top-line growth as Islamic and Takaful insurers in the GCC region continue to benefit from favorable growth prospects,” S&P stated. However, the agency issued a warning, stating that “in 2025, overall earnings will likely be impacted by increased competition in motor and medical lines, primarily in Saudi Arabia, the largest Islamic insurance market in the region.
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