According to insurance expert Mr. Fathalla Ebrahim, recent data released by the Central Bank of Bahrain revealed a decline in life insurance premiums. The statistics indicated that total premiums for life insurance amounted to BD 15.90 million in the first half of 2023, compared to BD 23.32 million in the same period of 2022, marking a notable decrease of 31.82%. This decline stands in stark contrast to other insurance lines such as medical insurance, which experienced a 12% increase, and motor insurance, which saw an 8% rise, based on the same statistics.
Mr. Fathalla emphasized the significance of recognizing the adverse implications of this decrease in life insurance premiums. He highlighted that this trend suggests a reduced awareness among citizens to use life insurance as a tool to protect themselves and their families against the risks and changes of life. Effective use of life insurance provides financial security and stability for the policyholders and their families. Additionally, as life insurance enables families of the policyholders to stay financially independent, there will be less burden on government and private social welfare spending.
In this context, Mr. Fathalla emphasized the necessity to intensify efforts aimed at raising awareness about the significance of life insurance in the Kingdom of Bahrain. Additionally, he stressed the importance of launching initiatives geared towards increasing the demand for life insurance.
“Life insurance might not seem crucial to individuals when they are young and without significant family responsibilities. However, it is essential to understand that life insurance premiums are influenced by age and health, making it more affordable when younger. Moreover, modifying an existing policy is more cost-effective than purchasing a new insurance policy later in life,” explained Mr. Fathalla.
“Death is an inevitable reality for everyone, occurring at various stages due to accidents, critical illnesses, or natural causes. Life insurance stands as one of the most vital insurance types, offering protection and financial stability to the insured’s dependents and safeguarding them against the unforeseen occurrence of death of their breadwinners.”
Mr. Fathalla also added that life insurance can provide solutions in other areas such as child education planning, retirement planning, investment and wealth creation and corporate financial planning for SMEs and family businesses.