In times of recession and global economic collapse, Syria undoubtedly looks inviting to most insurers and reinsurers. It is still a new market with big potential and a population of 20 million; such markets help stabilize our economy and build a better tomorrow. Success is all about making the right move. "Ultimately, Syria has a lot of growth ahead of it," emphasized Samir S. Nahas, Managing Director of GlobeMed Syria. GlobeMed Syria started its operations two years ago, and the company controls more than 50% of the Syrian insurance market. However, GlobeMed Syria has five other competitors.
"The market is still slow as people are not yet used to insurance, there is a lack of insurance awareness. We need more education for the masses," added Nahas. All the concerned parties like the Syrian insurance Supervisory commission and the Syrian Insurance Federation as well as the rest of the companies are trying hard to increase awareness. "And there are different means to accomplish that, these are not always easy to access but we are trying hard with the assistance of the proper authorities to reach the population in one way or another." On the other hand, when the government starts making insurance compulsory, the market will automatically be enhanced. So far, there are only 75 to 80 thousand adherents in the medical insurance sector. "This is too small a number for our two years operations. Nevertheless, the growth will speed up and in the coming two years we will reach the two million threshold," he added.
There are thirteen different companies in Syria including the national company and two new takaful companies, and there is one company in the process of applying for a license. Nahas believes that the number of companies is more than enough for the current market and authorities should not go beyond ten companies in the start. If the authorities grant licenses to additional companies that would harm the existing established organizations. The market as a whole needs more time to mature and develop. Therefore, for the time being 14 companies are more than enough. "Additionally, we are six TPA, which is also adequate for this stage in the development of the market. I hope the authorities will stop issuing new license." On a side note, the capital required for a new company is US$14 million for general insurance and US$3 million for life. That is quite a large capital and in order to acquire such a capital companies need to underwrite a substantial amount of business. "Therefore, I am always trying to compute the capitalization of the companies, which is reaching 300 million, and compare it to the market capitalization which has not yet produced 250 million dollars, after two years of operations," he said.
GlobeMed Syria has a capital of US$ One million; it is the biggest among the TPAs. It has around 40 employees; it is serving around 80000 of the market adherent, and six of the 13 companies. "You could say that we are the leaders of the market, but we believe in competition as it drives creativity and efficiency in the market, and creating more services, which are vital part in medical insurance," Nahas explained.
In 2008, GlobeMed Syria broke even and started earning profit this year. "We achieved our targets and we are confident that in the next three years we will make larger profits."
The total premiums in the Syrian market are around US$200 million, and medical takes only US8 million. Nevertheless, only five million Syrian nationals have medical insurance. Thus imagine the potential in the market when awareness grows and our penetration increases.
"We are continuing our business plan and helping insurance companies to market their medical plans, and enhancing the medical insurance needs in the market, as we have dealt with professional people who really know the market and its intricacies," Nahas added. GlobeMed Syria also helps companies to develop and design products in addition to reinsurance. Not to forget GlobeMed Syria is part of a larger group that has around ten sister companies in the region.
GlobeMed Syria has a branch in Aleppo and management is opening a new branch in Latakia and in several others area, depending on the number of customers. "Our branches consist of doctors and delegates that undertake all the administrative and control purposes."
Nahas went on detailing the effects of the crisis on the region: The crisis will need some time to be resolved, and we will require strict regulations to alleviate its fallouts and shorten its span. However, in our area I don’t think that we were affected like Dubai was. We were affected indirectly, as our insurance and banking companies were heavily regulated." But in other sectors for example the industries were affected by the drop in demand and prices.
Another effect is the loss of jobs by expatriates in the GCC which created a burden on the local market to find new job offers. In Syria, most problems have been quite benign and indirect. Therefore, we were not seriously affected and I think that these undirected consequences will not last long. But this is not the case in other countries such as Dubai which will face big problems that will last a long time. However, Dubai is getting substantial help from Abu Dhabi which will alleviate some of their problems.
