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Travel Insurance and Assistance in Saudi Arabia

  • January 2016
  • -
  • Finaccord
  • -
  • 33 pages

Finaccord’s report titled Travel Insurance and Assistance in Saudi Arabia is about the current status and likely future development of the market for stand-alone travel insurance policies in Saudi Arabia. It includes the following unique features:

- data spanning 2011 to 2015 for the underlying travel market with a segmentation by type of journey (between holiday and business trips) and with related commentary concerning the popularity of different overseas destinations;

- data for the size of the market for stand-alone travel insurance and assistance in Saudi Arabia between 2011 and 2015 in terms of premiums and policies, with a segmentation between single-trip and annual cover;

- analyses of the share of distribution relationships of travel insurance providers split between travel trade, transportation and financial organisations, based on a primary survey of over 120 actual and potential distributors of stand-alone travel policies including airlines, banks, insurance brands and specialised lenders, plus both traditional and online travel trade entities;

- a review of other direct and affinity distribution channels used in Saudi Arabia including automotive clubs, direct sales, online aggregators, other online brands and retailers, plus cover packaged with payment cards and bank accounts;

- estimates for the market share of travel insurance and assistance gross premiums for the top ten underwriters of this type of cover in Saudi Arabia in 2015 with these data points expressed as a percentage range (e.g. 5.0% to 7.5%);

- forecasts to 2019 for both the underlying travel market and for the size of the market for stand-alone travel insurance and assistance in terms of premiums and policies, with the same segmentation as that specified above for the period from 2011 to 2015.

The report, which represents an update and expansion to a previous Finaccord study on the subject, is accompanied by an Excel PartnerBASE™ dataset that details the travel insurance partnerships identified, plus a convenient market data annexe, also in Excel format. This annexe can be used as a convenient source of data already in Excel format which means that there is no need for users to re-enter data from the PDF report into their own Excel worksheets.

Table Of Contents

Travel Insurance and Assistance in Saudi Arabia
TABLE OF CONTENTS
00 EXECUTIVE SUMMARY 1
10 INTRODUCTION 3
What is this report about? 3
Rationale 3
This report builds upon Finaccord's previous ground-breaking studies about this topic 3
Methodology 3
Primary research 3
The survey includes over 120 travel trade, transportation and financial organisations 3
including airlines, banks, insurance brands and both traditional and online travel trade entities 4
Market data 4
External sources 5
Travel insurance and assistance: how it all fits together 5
The term 'travel insurance' can refer to protection from a heterogeneous range of risks… 5
and assistance companies play a fundamental role in the travel insurance industry 6
Definitions 6
Terms and abbreviations 6
Types of packaged travel insurance and assistance 6
Operating models 7
Weighted shares 8
Currencies, exchange rates and inflation 8
PartnerBASE 8
Finaccord 8
20 MARKET ANALYSIS 10
Introduction 10
Underlying foreign travel market 10
Outbound trips from Saudi Arabia have proved relatively resistant to economic difficulties… 10
… with business travel constituting a particularly low proportion of all journeys overseas 10
Over two thirds of outbound travel is to neighbouring or nearby countries 12
Market for travel insurance and assistance 12
Trip growth has brought about a steady rise in both policies and premiums… 12
… although annual policies are generally less prevalent than in other countries 12
Average travel insurance policy prices are comparatively high in Saudi Arabia 13
Distribution through travel trade, transportation and financial organisations 14
Summary of organisations researched 14
Provision rates 15
Less than a third of all potential distributors are actual distributors of travel insurance 15
Operating models 16
In the shape of MetLife ANB AIG, Arab National Bank is unique in using a joint venture underwriter 16
Competitor share of partnerships - travel trade entities 19
Seven underwriters claim distribution partnerships with travel trade organisations… 19
… albeit Medgulf claims just over a half of the weighted share of partnerships 19
Competitor share of partnerships - transportation organisations 21
Only two insurers are visible as providers of travel insurance for airlines… 21
…with AIG claiming the highest share in the weighted analysis of partnerships 21
Competitor share of partnerships - financial organisations 23
Al Rajhi Bank and SABB both employ captive underwriters for travel insurance… 23
…and a large number of insurance brands underwrite their own travel cover 23
Tawuniya and Medgulf lead the weighted analysis, reflecting their prominence as insurance brands 23
Travel insurance and assistance linked to payment cards and bank accounts 25
Other distribution channels 26
Automotive clubs 26
Direct distribution by specialist travel insurers 27
Online aggregators and brokers 27
Aggregator Sougalmal provides links to six travel insurance underwriters 27
Other online brands 27
HolidayGuard operates as a tied agent in the Saudi Arabian market 27
Retailers 27
Other types of distributor 27
Leading competitors 27
Medgulf is likely to be the clear market leader for stand-alone travel insurance in Saudi Arabia… 27
…with Al Rajhi Takaful, AXA Cooperative Insurance and Tawuniya also prominent… 28
…and with a large number of other companies claiming smaller shares, generally through direct distribution 28
Forecasts 30
Underlying foreign travel market 30
Growth in business trips should accelerate rapidly if and when the economy recovers… 30
… albeit they will remain dwarfed by journeys made for holiday and leisure purposes 30
Market for travel insurance and assistance 32
Relatively robust growth is expected for Saudi Arabia's travel insurance market… 32
… with annual policies forecast to outpace single-trip policies up to 2019 32
LIST OF GRAPHICS / TABLES
00 EXECUTIVE SUMMARY 1
Key market data for travel insurance and assistance in Saudi Arabia, 2011, 2015 and 2019 2
10 INTRODUCTION 3
Travel insurance and assistance: how it all fits together 5
20 MARKET ANALYSIS 10
Number of foreign trips undertaken by residents of Saudi Arabia, segmented by purpose of trip, 2011 to 2015 11
Number of foreign trips undertaken by residents of Saudi Arabia, segmented by purpose of trip, 2011 to 2015 (table) 11
Estimated gross written premiums and policy numbers for travel insurance and assistance in Saudi Arabia, 2011 to 2015 13
Estimated gross written premiums and policy numbers for travel insurance and assistance in Saudi Arabia, 2011 to 2015 (table) 14
Summary of travel trade, transportation and financial organisations researched in Saudi Arabia, segmented by type, 2015 15
Provision rates for stand-alone travel insurance and assistance in Saudi Arabia, segmented by type of travel trade, transportation and financial organisation, 2015 16
Operating models used for stand-alone travel insurance and assistance in Saudi Arabia, segmented by type of travel trade, transportation and financial organisation, 2015 17
Operating models used for stand-alone travel insurance and assistance in Saudi Arabia, segmented by type of travel trade, transportation and financial organisation, 2015 (table) 18
Partnerships with travel trade organisations offering travel insurance and assistance in Saudi Arabia, 2015: weighted and unweighted competitor share 20
Partnerships with transportation organisations offering travel insurance and assistance in Saudi Arabia, 2015: weighted and unweighted competitor share 22
Partnerships with financial organisations offering travel insurance and assistance in Saudi Arabia, 2015: weighted and unweighted competitor share 24
Provision rates for travel insurance and assistance linked to payment cards and bank accounts in Saudi Arabia segmented by product function and level, and by type of cover 26
Individual competitors' estimated market shares of gross written premiums and other revenues for stand-alone travel insurance and assistance in Saudi Arabia, 2015 29
Individual competitors' estimated market shares of gross written premiums and other revenues for stand-alone travel insurance and assistance in Saudi Arabia, 2015 (table) 30
Number of foreign trips undertaken by residents of Saudi Arabia, segmented by purpose of trip, 2019 (forecast) 31
Number of foreign trips undertaken by residents of Saudi Arabia, segmented by purpose of trip, 2019 (forecast) (table) 31
Gross written premiums and policy numbers for travel insurance and assistance in Saudi Arabia, 2019 (forecast) 32
Gross written premiums and policy numbers for travel insurance and assistance in Saudi Arabia, 2019 (forecast) (table) 33

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