Inflation Rate and Gross Written Premium (GWP) Influence on the Profitability of UAE Insurance Sector. A Post Financial Crises Analysis
DOI:
https://doi.org/10.14666/2194-7759-9-2-009Keywords:
assurance, monetary emergency, medical coverage, protection incomes, reinsurance organizations, liquidityAbstract
This study highlights how the profitability of insurance companies is affected by the gross written premium (GWP) and the inflation rate in the United Arabs Emirate (UAE). The sector of insurance globally has been affected due to the financial crises in 2007-2008. UAE insurance sector witnessed a shrink from 2008-2010. This research discovers the impact of the inflation rate and gross written premium (GWP) on the profitability of the United Arab Emirates (UAE) insurance sector from 2010 to 2019, and how the insurance sector improved during the post-financial crises. The UAE insurance market offers two types of insurance: the conventional insurance, that allows individuals to shift the burden of riskiness loss to the insurance firm, and the Takaful insurance that collects the premium by the members in order to ensure that there’s no damage or loss against each other.
Islamically insurance is essentially an idea of mutual help; therefore, the difference between the two insurances should be cleared up. In developed countries, individuals may own a range of assets and have exposure to potential risks that demand some form of life and/or general insurance protection. They also desire to secure incomes for their own confiscation or family members in the event of their death. In developed countries, businesses also are more plausible to use insurance to lessen the financial impact of adverse events. Insurance sector in developing countries has shown an increase even if the level of development of this one remains low compared to developed countries since the developing countries have a lack of coverage. Insurance can help society to improve livelihoods, increase the country’s productive capacity and secure prosperity.
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