SOLIDARITY Bahrain chief executive Jawad Mohammed has highlighted the vital role the industry plays in creating a strong financial foundation for both individuals and businesses.

"Our mission is to build a more secure and prosperous future for Bahrain," Mr Mohammed told the GDN in the run-up to National Insurance Awareness Day.

"A healthy insurance sector is essential for a sustainable economy and financial system." Underscoring insurance's core function of mitigating financial hardship caused by unforeseen events, the Solidarity Bahrain CEO said, "Insurance safeguards people against unexpected risks and losses."

He pointed to Bahrain's low insurance penetration rate, citing industry data, and emphasised the vast potential for growth. "Currently, the insurance penetration rate in Bahrain stands at 1.7 per cent, which is significantly lower than the global average of 6.8 per cent. It is estimated that over 80pc of potential risks remain uncovered by insurance in Bahrain.

This means that most people and businesses would bear the full financial burden of events like natural disasters, accidents, or illnesses if they were not insured." To address this gap, Mr Mohammed proposed a multifaceted approach. "Public education about the benefits of insurance is crucial," he said.

"The industry also needs to develop more affordable and accessible products catering to diverse needs and budgets. The government could explore introducing mandatory coverage such as travel, domestic helper, medical malpractice and professional indemnity."

Established in 2003, Solidarity Bahrain has quickly become a market leader in terms of premium income, market share, and profitability. Sharing the recipe for the company's success, the CEO explained, "Our commitment to expansion through mergers and acquisitions has been a key factor in our success.

Over the past two decades, we've acquired and merged with several companies, solidifying our position in the market."

He attributed the company's achievements to a clear strategy, effective implementation, and a talented team. The strategy aimed to improve customer experience, staff opportunities, and social impact, ultimately driving profitability and market share growth.

On the market outlook and growth drivers, Mr Mohammed said Bahrain's focus on diversifying its economy beyond oil presents insurance opportunities in new sectors like renewable energy and logistics.

"The market size is only around $750 million, but the vast protection gap presents a significant opportunity," he noted.

"We are particularly optimistic about the upcoming mandatory health insurance scheme expected to be rolled out by the government next year. Solidarity Bahrain has the largest medical insurance portfolio in the country, which will position us well to benefit from this development." "We are also working closely with the government and the Central Bank of Bahrain (CBB) to advocate for mandatory coverage in other areas beyond the current mandatory third-party motor insurance," he added.

"Expanding mandatory coverage will undoubtedly fuel further growth for the industry." On the topic of innovation and technology, the CEO emphasised Solidarity Bahrain's commitment to staying ahead of the curve through continuous investment in technology and product development.

"We recently launched a new third-party motor insurance product that includes features like car replacement and roadside assistance," he said. Solidarity Bahrain also prioritises exceptional customer service as a competitive advantage. "We've established a dedicated department focused solely on service delivery and customer experience," Mr Mohammed said. "We invest heavily in employee training and development to ensure we stay ahead of the evolving customer landscape."

The company is actively embracing digitalisation, innovation, and artificial intelligence (AI). Last year, Solidarity Bahrain launched a new, user-friendly website for buying insurance and managing policies online. It also migrated the IT infrastructure to the Oracle Cloud, aiming to improve customer experience, operational efficiency, and cost savings through cloud technology and AI.

"We've implemented a new system for our life insurance business and introduced innovative products like individual cyber insurance and office comprehensive insurance aligned with the government's SME strategy, he highlighted. "We've also streamlined the entire motor claims process through a new digital claims system. The 'Mutalabat' platform connects workshops, parts suppliers, and customers electronically for faster repairs. Around 80% of our claims are now registered through digital channels."

The CEO underscored the importance of digitalisation as a cornerstone of the company's strategy. "Digital is the future, and we are committed to ongoing investment in this area," he said. "Today, customers can seamlessly interact with Solidarity Bahrain through both physical and digital channels. In fact, 60pc of our retail business now comes through digital channels."

According to him by embracing digital solutions like InsurTech, Solidarity Bahrain is looking to streamline processes, personalise offerings, and create a more customer-centric experience. "This will also help us to attract younger demographics," he added. Sustainability is another key focus for Solidarity Bahrain, according to Mr Mohammed. "Our core mission is protecting people," he explained. "By offering insurance products, we help people build financial resilience and mitigate risk. We are also integrating sustainability principles into our underwriting practices."

Sustainable practices adopted by Solidarity Bahrain include reducing paper use, using energy-efficient technology, and even supporting renewable energy. "Our investments prioritise companies with strong environmental and social responsibility," Mr Mohammed said. "We also partner with eco-friendly organisations and offer insurance products on solar power aimed at encouraging sustainable practices."

He also said that the company is fully committed to complying with the new module by Central Bank of Bahrain (CBB) requiring the integration of Environmental, Social and Governance (ESG) considerations into listed companies' control mechanisms, risk management and other business practices.

The CEO commended the CBB's efforts in adopting global best practices to support industry growth. He also acknowledged the evolving role of human capital in the age of artificial intelligence (AI).

"While some jobs will inevitably be replaced by AI, new opportunities will also emerge," he said. "The challenge lies in equipping our workforce with the skills needed for the jobs of tomorrow. Upskilling and continuous learning will be paramount." The interview concluded with Mr Mohammed reiterating the importance of market consolidation and expressing optimism about the outlook for 2024.

"Bahrain's insurance market is fragmented, and consolidation is necessary," he said. "We believe it's time to create a landscape of strong, well-capitalised companies. He cited several reasons for his optimism about growth, including cooling inflation, the company's participation in government efforts to stimulate Bahrain's SME sector, and the upcoming implementation of mandatory health insurance rules.