Information from the United Nations insurance companies in the UAE indicates that the global trend in prices for new reinsurance contracts points to their increase due to climate changes, extreme weather events, and natural disasters. Nevertheless, currently, there are ongoing discussions between local companies in the UAE and international reinsurers to retain new contracts for the coming year at current levels, avoiding price hikes for insured persons.
Mohammed Muzaher Hamada, deputy chairman of the Higher Technical Committee, chairman of the automobile committee in the Union, emphasized: "Our local companies have strong arguments, given that in previous years reinsurers made larger profits due to the absence of major calamities or payouts in the UAE, and it is necessary for one year not to become a measuring stick due to weather anomalies."
Hamada added: "We insist on this argument, our position is clear, and we hope that our demands will be met by the reinsurers." Mohammed Abda, a member of the board of directors of the Union of Insurance Companies, chairman of the financial committee and the committee on combating financial crimes in the Union, noted that this year there has been a global increase in prices for reinsurance in various sectors of insurance.
Abda explained: "For example, the cost of reinsurance in Turkey has increased by 50–100% due to earthquakes, while in Europe the increase has reached 50% due to the Russian-Ukrainian war, and in China—from 5% to 20%, and so on." He pointed out that one of the main reasons for the increase in prices has been the greater amount of requirements and payouts due to calamities, as well as the absence of reinsurance due to the impossibility of international insurance companies concluding new contracts.
Abda noted: "The increase in prices varies by sector, but there have already been increases in contracts concluded this year." He emphasized that reinsurers are trying to raise prices again, but discussions and negotiations are ongoing about maintaining current tariffs, so as not to impose additional obligations on insured persons and avoid price hikes for documents.
