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The Actuary The magazine of the Institute & Faculty of Actuaries
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International: Middle Eastern actuary

Bahrain
by Hamed Abdulla, Lux Actuaries and Consultants WLL

With one of the highest population densities in the world, located just a 30-minute drive from Saudi Arabia’s Eastern Province, and with superb incentives offered by the government to attract international insurance firms, it is no wonder that the island of Bahrain is considered as a preferred insurance destination in the Middle East.

The Central Bank of Bahrain (CBB), the entity responsible for setting the regulations for Bahrain’s financial services, currently requires a detailed actuarial and statutory report for each insurance company operating in the country covering the evaluation of the reserves and liabilities. With more than 75 registered insurance companies in Bahrain – both conventional and Takaful (Islamic insurance) and with 25 applications for new insurance companies approved by the CBB in 2007-2008 alone, it is not surprising that the demand for actuarial services is growing significantly.

There are 23 actuarial firms authorised to work in Bahrain. However, only a few have enough local resources to assist in the training and development of local capabilities. Since actuarial studies are not supported at any of the universities on the island, the CBB is relied upon to provide guidance in this relatively exotic profession. The CBB is aiming to develop actuarial standards and recognise the importance of actuaries in the underwriting and reserving techniques of insurance firms.

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Kingdom of Saudi Arabia (KSA)
by Ehab Attassi, Tawuniya Company for Cooperative Insurance

After new regulations by the Saudi Arabian Monetary Agency (SAMA), the financial regulator, in late 2005, the insurance market became wide open to business competition. The new regulations contributed to the revival of all businesses related to the insurance and reinsurance sectors, and one of these is the birth of actuarial business in Saudi Arabia. Further initiatives by SAMA obliged all insurance companies to appoint an actuary, or seek the services of an actuary or actuarial firm approved by SAMA. Currently, in the whole of the KSA, there is only one actuarial firm in Riyadh approved by SAMA.

Clearly there is a substantial lack of qualified actuarial professionals in the area. The reason stems from the fact that Saudis working in the insurance field are not acquainted with the concept of actuarial science. Due to this demand for actuaries, the Saudi market is attractive for qualified actuaries from abroad.

The current trends should interest other actuarial firms in establishing business practices in the KSA thereby providing a platform for encouraging young Saudis to enter in this field.

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Abu Dhabi
by Werner Weber, Abu Dhabi Commercial Bank.

Abu Dhabi feels a little like California must have felt in the mid-1800s. People are rushing here from all over to be part of the boom, while the government is doing its best to keep feeding this hungry economy with the physical infrastructure and regulatory framework it needs to continue orderly growth.

In the aftermath of the credit crisis, the oil rich emirate of Abu Dhabi seems to be powering ahead with a number of multi-billion dollar projects, while other emirates are left struggling with costly debt restructurings to stay afloat.

In terms of work life, there seems to be more of a focus on experienced people who can come in and build businesses from scratch. Given this, processes and methodologies generally can also be a little stuck in the 1800s and this is certainly a challenge for young people coming here and looking to learn. The flip side of this is that meetings are generally held at CEO or CFO level, which allows you access to some fairly senior people early on in your career. Standing in the same room with the likes of Alan Greenspan, Warren Buffett, Bill Gates and Jim Rogers is a privilege one is unlikely to have in most other countries but somehow sounds normal in Abu Dhabi.

All factors considered, Abu Dhabi is a great place to work for a few years and save up some tax-free dollars. In terms of longer-term career prospects and quality of life, my view is that the emirate will need to rethink its offering and how it aims to retain skills in order to build a core population who can take ownership and take the city forward.

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Dubai
By Rikus Rousseau - American Life Insurance Company (ALICO)

Dubai is the land of opportunity to many from all around the globe and the place has a real buzz about it. From mega construction projects like the Palm islands to the world’s tallest building, Dubai has made a statement to the rest of the world, albeit some recent debt glitches.

Dubai has had its share of growth pains during the rapid economic growth over the last 15 years, and the actuarial job market is no different. Fellows and Associates may have a hard time to find the ‘employer of choice’ since actuarial opportunities are limited. Additionally, proper study support for students is uncommon relative to other actuarial job markets. Since most skilled expats intend to stay for the short term (resulting in a high staff turnover rate), employers tend to pay little attention to professional development and staff retention. Regulation of insurance companies is still evolving; this, together with the lack of consumer protection means the Actuary has a greater task to ensure fair treatment for policyholders.

On the bright side, Dubai offers exposure to a wide range of work and an array of cultures at the workplace. There’s also a small (and diverse) actuarial community that comprise mostly of members from the US Society and UK Institute/Faculty. Over the years, Dubai has attracted skilled professionals from around the world with a tax-free dollar income. However, like the US and some EU economies, Dubai has more recently proven not to be immune from dry credit markets and a global recession. As Dubai World is restructuring its debt, stronger emphasis may be placed on actuarial risk management skills to better manage assets and liabilities of financial (and other) institutions. This, together with Dubai’s past impressive economic growth means a strong demand for financial services in the long term is inevitable - and with it, promising actuarial prospects.

In summary, working in this desert place of sand, sun and camels is a life experience in its own, not to mention its promising actuarial potential.