Predictions are that the Oman life insurance market will grow at an average annual rate of 12.1% up to 2021, driven by the gradual introduction of compulsory health insurance, population growth, infrastructural development and a revival in business activity.
The principal focus of life insurance in Oman continues to be on term life coverage for bank loans and mortgages, primarily via the bancassurance channel. Endowment insurance has been shrinking for some years: as yet there are no local investment-linked individual savings products available from the local market. It is worth noting that the purchase of individual life insurance is not subject to non-admitted insurance regulations.
Following the approval in 2017 of the Council of Ministers and the Ministry of Health for the implementation of a compulsory private medical insurance (PMI) scheme for all those people (and their dependants) working in the private sector of the economy, the insurance market regulator (Capital Market Authority/CMA) has been working on developing the required regulatory framework. This process will include drafting a unified policy and considering issues of compliance and oversight. The new scheme, to be insured in the private sector insurance market, is aimed at reducing the burden on the state in respect of its contribution to healthcare costs and is expected to cause future PMI gross premium to increase significantly. The scheme is expected to be rolled out in phases starting later this year and to take about two years to implement fully.
The regulator is considering a modest easing of the restrictions on insurance companies and takaful operators investing abroad by increasing the current permitted maximum percentage of investment abroad from 25% to 30%.
Anecdotal evidence also suggests that the regulator is examining the possibility of introducing a unified policy for individual credit life insurance business sold via bancassurance.