Read Full Magazine Here. The insurance sector plays a vital role in the Palestinian economy, given all challenges imposed by occupation and the complexity of situation in Palestine.
Consequently, growth rates are stagnant, and businesses across the country often lack insurance protection. The Palestine Capital Market Authority is responsible for regulating and supervising the insurance sector in Palestine in accordance with the Palestinian Insurance Law.
Al Mashreq Insurance has been a prominent provider of diverse insurance services and solutions to the Palestinian public since 1993. Through strategic partnerships with numerous clients and suppliers, as well as creating career opportunities for thousands of employees and suppliers, Al Mashreq Insurance has emerged as a leading player in the Palestinian insurance market. The company has fostered strong relationships with its agents, enabling it to provide exemplary client-oriented services.
The company has successfully established robust business relationships and boasts a roster of well-known business professionals and companies, both domestically and internationally, among its shareholders.
The company’s commitment to enhancing the quality of life for Palestinians is evident through its community support, cultural and environmental initiatives, which empower women, children, youth, entrepreneurs and small project owners in developing their businesses and promoting their products to a wider audience.
In order to address these challenges more effectively, Nihad Assad, the General Manager of Al Mashreq Insurance Company, sheds light on the company’s vision and its commitment to finding practical solutions tailored to serve the Palestinian community despite the unique difficulties and circumstances.
Assad has enjoyed a successful career marked by remarkable achievements and unwavering dedication to the industry and the entire MENA region, particularly during challenging times. With around 30 years of experience, his expertise continues to contribute to the enrichment and advancement of the field, as he consistently imparts his knowledge and insights to benefit the insurance sector and its stakeholders.
Assad also boasts an impressive educational background and a wealth of qualifications. He holds a Master of Business Administration (MBA) from BirZeit University, demonstrating his advanced knowledge and expertise in the field of business administration. He has also earned a Bachelor’s degree in Business Administration, providing him with a solid foundation in the principles of business and commerce. He has acquired various professional certificates, further enhancing his credentials and expertise in the field. These diverse qualifications underscore Assad’s commitment to continuous learning and his dedication to acquiring the necessary skills to excel in his role within the insurance industry.
In September 2014, he received the prestigious First Research Award from the General Arab Insurance Federation for his outstanding contributions. His research focused on the critical analysis and evaluation of customer satisfaction regarding service quality within the insurance industry in Palestine. Additionally, he holds significant positions of influence and responsibility in various organizations. He serves as the Vice President of the Palestinian Insurance Federation (PIF), demonstrating his commitment to the advancement of the insurance sector. Moreover, he actively contributes as a board member and financial advisor at the Palestinian Motor Sport & Motorcycle Federation (PMSMF), showcasing his dedication to supporting sporting initiatives. Alongside his professional pursuits, he actively engages in voluntary work, exemplifying his commitment to giving back to the community.
BL: What are your thoughts on fraud in medical insurance?
Nihad Assad: Fraud in health insurance is a significant problem and contributes to substantial losses in the health insurance sector. Addressing this issue requires advanced technological solutions, improved control measures, and shared responsibility among different parties. Companies that insure their employees often face annual premium increases due to these losses. Thus, insurers must partner with the affected companies to find solutions, which may involve profit sharing, implementing systems to monitor employee behavior, and taking necessary actions against abuses.
Fraud is not limited to health insurance; it exists across all lines of insurance, including motor insurance. It can involve scenarios like changing the driver or altering the location of an accident, resulting in increased claims costs. This fraudulent behavior creates a major problem in the market and leads to higher costs for all stakeholders, including mechanics, hospitals, and experts. Addressing fraud requires not only competitive insurance rates but also controlling costs and ensuring fair practices from all suppliers.
BL: Do you think fraud occurs more frequently in the MENA region?
Nihad Assad: Fraud occurs worldwide, but the percentage of fraud cases is higher in the MENA region due to inadequate law enforcement in some areas. The implementation of laws and regulations plays a crucial role in reducing fraud and changing the perception of insurers and insurance companies. When laws are effectively enforced, those who commit fraud face consequences such as being blacklisted across various systems. Insurance companies can detect fraud, raise premiums accordingly, and punish those who try to abuse the system. Therefore, the focus should be on implementing and enforcing laws rather than blaming the mentality of individuals.
BL: What are your views on ERS and self-driving vehicles? In case of an accident involving an autonomous vehicle, who should be held responsible: the car owner or the manufacturer?
Nihad Assad: Self-driving or autonomous vehicles represent the future of transportation, and insurance companies must carefully study and develop strategies to address the associated challenges. When it comes to vehicles without drivers, determining responsibility becomes crucial. I believe the owner of the vehicle should bear a certain percentage of responsibility, but the main responsibility lies with the manufacturer of the vehicle. This scenario opens up new opportunities for insurance companies to offer coverage specifically tailored to this emerging technology. With the potential risks and malfunctions, there will be an increased demand for this type of insurance. Individuals will likely need to have this additional coverage alongside standard motor insurance, creating a new line of business for insurance companies.
BL: How is the situation regarding law implementation in Palestine?
Nihad Assad: The situation in Palestine presents challenges as specific areas and cities are under the limited control of the Palestinian government. Implementing laws in such a complex environment is difficult. For instance, if an accident occurs outside a city, the traffic police might face difficulties reaching the location. This increases fraud, costs, and operational challenges for insurance companies navigating between cities. Additionally, roads outside the cities are used by both Palestinians and Israelis, resulting in accidents that insurance companies have to handle. Despite these difficulties, insurance companies in Palestine continue to operate and strive for improvement. The insurance sector in Palestine shows progress, and hope there is a better future.
BL: Do these challenges pose additional obstacles for Palestinian insurance companies?
Nihad Assad: Yes, these challenges are significant obstacles not only for Palestinian insurance companies but also for insurers across the Arab world and the MENA region. Importing vehicle parts and ensuring smooth operations, particularly for marine insurance and other lines of business, pose additional difficulties in such a complex and divided environment.
BL: How do you protect customers from cyber-attacks?
Nihad Assad: Cyber-attacks present a significant challenge for insurance companies, and we actively work to protect our customers. We employ various measures such as firewalls and secure servers to safeguard customer data and privacy. Improving our systems and working online across all aspects of our operations, including claims management, is part of our ongoing plans. Investing in cyber security is crucial to ensure the safety of data, privacy, and financial transactions. As we undergo digital transformation, we prioritize implementing best practices to mitigate cyber risks and breaches. This shift towards digitalization presents opportunities to enhance our competitiveness and streamline our business processes.
BL: Is digitalization an additional expense?
Nihad Assad: Digitalization represents an additional investment rather than an expense. We view it as a strategic plan for the future. By embracing digital technology, we can modernize our operations and keep up with the evolving insurance landscape. We believe it is a worthwhile investment that will benefit our business in the long run, enabling us to remain competitive across all lines of business.
BL: What are your plans regarding Customer Relationship Management (CRM)?
Nihad Assad: Updating client information and streamlining our systems to ensure we have the right information at the right time is a crucial aspect of our CRM plans. We are working on these initiatives internally, updating client information, and outsourcing specific tasks to IT or tech companies. We recognize that effective CRM is an investment that allows us to provide prompt and personalized services to our clients.
BL: How was the profit from last year, and what are your expectations for the end of 2023?
Nihad Assad: Al Mashreq Insurance has been making stable progress. As a publicly traded company, our production and premiums are increasing. We focus not only on quantity but also on the quality of our numbers. Last year, we achieved excellent results, maintaining stability across our branches and offices. On the investment side, Al Mashreq Group, including Al Aqaria and Pal Med Service Companies, contributes to our positive financial results. We aim to continue operating at the same level next year.
BL: What are your views on Aqaba Conf 2023?
Nihad Assad: Aqaba Conf 2023 has been organized exceptionally well, with a significant number of participants—likely exceeding 900 attendees. Such conferences provide us with valuable opportunities to engage, discuss the latest subjects, and stay updated on market trends. I believe the conference will continue to occur every two years. Furthermore, the upcoming GAIF Conference 2024 in Muscat next year will also be a significant event for the insurance industry in the region.
