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InsurTech is composed of the words “insurance” and “technology”. It is used as a collective term for the application of modern technologies in the domain of insurance services.
Digital and mobile brokers: FinTechs belonging to this category mostly act as digital insurance brokers and provide users with an overview of their insurance contracts with their respective conditions. Some FinTechs offer very short-term insurance contracts to cover specific cases which can be concluded often spontaneously via mobile devices. Oftentimes additional consulting services are offered.
Internet of things: FinTechs belonging to this category collect data by measuring for example the driving style of the customers or through wearables the customers wear to consult on, offer and/or manage the customer’s insurances.
Introduction
Attitude of the country towards InsurTech-services
The Saudi government is keen on digital transformation and technological advancements in the insurance sector. However, there are reservations relating to data privacy, cybersecurity, and the regulatory framework, which is still evolving to accommodate these new technologies.
Legal affairs
Obligations and requirements to provide InsurTech-services
To provide InsurTech-services in Saudi Arabia, companies must obtain a license from the Saudi Central Bank (SAMA). The licensing process involves meeting specific regulatory requirements, including financial stability, transparency, and compliance with Saudi insurance laws. The costs for obtaining a license can vary, and firms must also maintain certain financial reserves as mandated by SAMA. Running costs include compliance costs, cybersecurity measures, and regular audits to ensure adherence to regulations.
Additional comments regarding the legal situation for InsurTech-services or what InsurTech’s must be aware of in this business area
N/A
Economic conditions
Market size for InsurTech-services and biggest companies in this business area
he InsurTech market in Saudi Arabia is growing, driven by increasing digital adoption and a young, tech-savvy population. A 2019 report issued by SAMA stated the total written premiums reached SAR 37.89 billion (approximately USD 1 billion), and the market shows significant potential with a growth rate at 8% circa. Major players in the Saudi InsurTech market include companies like Tameeni and Bayzat, which are making substantial inroads in the sector.
Additional comments regarding the economic situation for InsurTech-services or what InsurTech’s must be aware of in this business area
InsurTech companies should be aware of the competitive landscape and the need for innovative solutions tailored to the local market. Partnerships with traditional insurance companies and leveraging local expertise can be beneficial