MGAs represent 43% of DIFC’s insurance constituents, as of September, contributing $2.1bn of gross written premium.
Dubai International Financial Centre (DIFC) has a focus on managing general agents (MGAs) for the regional re/insurance hub’s growth.
DIFC said an influx of MGAs from across the Middle East, Africa and South Asia (MEASA) region over the past five years has been a significant contributor to its $2.1bn market.
MGAs in DIFC now account for 43% of the sector, DIFC said. They have relocated from across the MEASA region, contributing $2.1bn to DIFC’s gross written premiums.
The DIFC is positioned as an emerging global hub for re/insurance, focused on supporting growth for the MEASA region.
MGAs are seen as key to growing the insurance and reinsurance value chain, providing an accessible route for technology-focused startups, with a tendency to focus on specialty lines of insurance, as well as providing a new avenue for outside investors or other insurers to provide capacity for the MGAs to write.
“MGAs are turning to financial centres like DIFC to better serve their existing clients,” said Salmaan Jaffery, chief business development officer at DIFC.
“Dubai’s geography means that MGAs are conveniently located to hedge existing businesses they have from the same time zone. It also means that MGAs are finding access to new markets that they wish to penetrate and service,” he said.
“Additionally, there is a preference for an internationally benchmarked jurisdiction with straightforward laws and regulations and a robust regulatory framework, which is available in DIFC,” added Jaffery.
MGAs represent 43% of the DIFC’s insurance constituents, according to figures released by DIFC in September, contributing $2.1bn to DIFC’s gross written premiums.
“One of the primary reasons MGAs are drawn to DIFC is that they can create partnerships with cedants and brokers that they wouldn’t be able to find outside this market,” Jaffery said.
The onus on attracting MGA is part of a wider growth trend in DIFC’s re/insurance community.
For 2023, the hub said it is on track to see 20% insurance growth, with gross written premiums up 18% in the first half of 2023 year-on-year.
DIFC is home to nearly 120 insurance and reinsurance-related companies, with MGAs such as Dual Corporate Risks, Mosaic Insurance Services (DIFC) and Optio Re MENA complementing established players such as AIG, Berkshire Hathaway and Zurich.
“The continuing increase in company registrations from the sector provides a buoyant outlook for workforce as well as gross written premiums,” said a DIFC statement.
“DIFC has built a globally recognised regulatory environment with strategic, financial, and operational benefits associated with geographical expansion for reinsurers, brokers, independent MGAs, and Lloyd’s service companies and cover holders,” DIFC said.
“In addition, buoyant oil prices, increased infrastructure spending and low insurance penetration in the region have worked positively for the reinsurance market within DIFC,” the statement added.