UAE Insurers Post Higher H1 Profits, Continue To Recover From 2024 Record Rains

The UAE insurance sector maintained its recovery trajectory in the first half of 2025, building on the strong first-quarter performance and further distancing itself from the stress impact of April 2024 rains.

The sustained recovery was helped by increased premium rates and strong investment income.

Data released by Badri Management Consultancy revealed that insurance revenue for the 27 listed companies increased 19 per cent to Dh24.6 billion during the January-June 2025 period compared to Dh20.7 billion during the same period last year.

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“This expansion reflects sustained premium rate increases, improved risk-based pricing, and continued demand in motor and medical lines, which remain the primary growth drivers,” the Consultancy said in its first-half report.

The UAE recorded the highest rains in 75 years in April last year, causing major damages to automobiles and properties in Dubai, Sharjah, and the northern emirates. Insurers posted billions of dirhams in claims following the unprecedented rains.

Badri Management data revealed that the top five companies accounted for Dh16.9 billion of total revenue, a growth of 19 per cent from Dh14.2 billion last year, while the remaining companies collectively grew 17 per cent to Dh7.7 billion.

The UAE insurers saw a strong growth in profitability during the January-June 2025 period, growing by 63 per cent to Dh2.2 billion compared to Dh1.3 billion in the same period last year.

The top five profit generators contributed Dh1.6 billion, up 32 per cent, while the remaining insurers collectively grew their profits by 420 per cent, from Dh107 million to Dh557 million. Importantly, the proportion of profits linked to insurance activities remained high, with 80 per cent of industry earnings derived from industrial special risks (ISRs), highlighting a shift towards core underwriting profitability rather than reliance on investments.

Nevertheless, Badari said that investment income continued to play a key role for several players. Among the top 10 profit generators, the majority were supported more by investment performance than insurance results.

“Some insurers maintained industry-leading margins above 25 per cent, while others, though still negative, improved significantly compared to last year. These shifts signal early progress in underwriting discipline but highlight the challenges facing weaker players,” it said.

Looking ahead, Badri Management sees that gradual premium rate improvements, coupled with enhanced regulatory oversight, will sustain underwriting margins and discourage underpriced policies.

However, it warned that insurers must remain cautious of potential reinsurance cost escalations and deferred impacts of treaty renewals, particularly in light of the 2024 weather-related losses.“With profitability increasingly tied to core insurance operations, the industry's long-term sustainability will depend on insurers' ability to preserve underwriting discipline, strengthen claims management, and reduce dependency on volatile investment income,” it added.

Overall, the first half of 2025 confirms that the UAE insurance sector is firmly on a recovery path, with rising profitability, stronger underwriting results, and continued market concentration around the top players.“A full-year outcome will largely hinge on maintaining premium discipline and navigating evolving reinsurance dynamics,” said Badri analysis.

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