In the Gulf’s fast-growing economies, vehicles are far more than just a mode of transport, they’re vital business assets that keep your operations moving smoothly. Whether you manage a fleet of delivery vans in Oman, executive cars in the UAE, or service vehicles in Kuwait, choosing the right motor insurance plan isn’t optional; it’s a business imperative.
Why? Because the Gulf motor insurance market is growing steadily, reflecting the increasing importance of vehicles in the business landscape. For instance, the Gulf Cooperation Council (GCC) motor insurance market is projected to reach a whopping US$8.30 billion by 2029, up from US$7.88 billion in 2025 This growth, averaging about 1.31% Compound Annual Growth Rate annually, underscores how businesses are investing more in protecting their fleets – an indication of rising vehicle ownership and regulatory tightening
Understanding the Types of Motor Insurance Businesses Need
Before diving into the numbers, it’s crucial to understand the available coverage options:
- Third-Party Liability (TPL): Required by law across all GCC countries, TPL covers damages your vehicle might cause to others. However, with expanding fleets and high-value vehicles, relying solely on TPL leaves many businesses under protected.
- Comprehensive Coverage: This is becoming the preferred choice for companies, especially in markets like the UAE, where vehicle ownership is surging. Comprehensive policies primarily offer Material Damage coverage, protecting your own vehicles against physical loss or damage. This includes theft, fire, vandalism, and natural disasters such as sandstorms, floods, and hail damage, all of which are highly relevant risks in the Gulf’s unique environment, especially in light of last year’s severe weather events.
- Fleet Insurance: As fleets grow, managing insurance becomes complex. Markets like Kuwait, which leads the GCC with a 10.3% growth rate in motor insurance turnover and an impressive 8.2% Compound Annual Growth Rate, are seeing more businesses opt for fleet solutions that streamline coverage and control costs.
Why Coverage Needs Differ Across GCC Countries
The diversity of motor insurance penetration and market size across GCC nations reveals why a one-size-fits-all approach doesn’t work.
- UAE: With an insurance penetration rate of 2.5% and a market size of US$1.29 billion in 2023, the UAE is experiencing solid growth. However, recent events have highlighted vulnerabilities. In April 2024, Dubai experienced its heaviest rainfall in 75 years, leading to severe flooding. The deluge caused significant disruptions, including the submersion of Dubai International Airport, widespread road closures, and damage to infrastructure. The estimated damage reached US$2.93 billion, with insurance losses expected to be substantial. This event underscores the need for businesses to reassess their insurance coverage to protect against such unforeseen risks.
- Oman: Oman has moderate insurance penetration and is witnessing steady growth. However, the country is no stranger to natural disasters. In October 2021, Cyclone Shaheen caused widespread flooding, resulting in the loss of at least 14 lives and significant damage to infrastructure. The estimated economic loss was approximately US$520 million. These events highlight the importance of comprehensive motor insurance to mitigate potential losses from natural disasters.
- Kuwait: With the lowest insurance penetration at 0.5%, Kuwait’s market is rapidly developing. The country is experiencing the fastest growth in motor insurance, with a 10.3% growth rate in turnover and an 8.2% Compound Annual Growth Rate. Businesses in Kuwait are increasingly recognizing the value of protecting their vehicles amid expanding commercial activities.
- Bahrain: Bahrain’s insurance market reached approximately US$799 million in 2022, with motor insurance being one of its dominant lines. While insurance penetration is higher than in Kuwait, the pace of growth remains moderate. As Bahrain continues to invest in infrastructure and its transport sector, businesses are increasingly seeking motor insurance options that support fleet scalability and regulatory compliance.
- KSA: Although DAMANA does not operate in Saudi Arabia, it remains the GCC’s largest insurance market, with total gross written premiums exceeding US$12 billion in 2023. KSA has recently introduced regulatory reforms to strengthen consumer protection and increase insurance uptake. While its motor insurance penetration rate is improving, challenges remain around uninsured driving and claims efficiency, issues other GCC markets can learn from when refining their own motor insurance strategies.
What Businesses Should Consider When Choosing Insurance
Given these varying market dynamics, businesses should tailor their motor insurance based on:
- Fleet Use and Risk: Commercial delivery vehicles face different risks compared to executive cars. For example, in the UAE’s bustling logistics sector, these vehicles are often used intensively and under demanding conditions, leading to greater wear and tear, a higher likelihood of breakdowns or accidents, and longer downtime during repairs. As a result, higher coverage limits and add-ons like roadside assistance become critical to maintaining operational continuity.
- Vehicle Type and Age: High-value or leased vehicles, common in more affluent markets like Kuwait and the UAE, often require comprehensive plans, while older vehicles might need tailored products with add ons to balance cost and protection.
- Cross-Border Operations: Many GCC companies operate across borders. Not all insurance policies cover cross-country use, so ensuring your fleet is protected throughout the GCC is vital.
- Additional Protections: Add-ons such as personal accident coverage, agency repairs, and off-road use reflect how businesses in the region are customizing policies to meet unique operational needs.
The Value of a Trusted Insurance Partner
With growing fleets and complex regulations, partnering with the right insurer is crucial. At DAMANA, we recognize the Gulf’s fast-paced business environment and regulatory nuances. We offer:
- Customized fleet solutions aligned with your business growth, including coverage designed for multi-territory operations across the GCC
- Expertise in GCC regulatory compliance to avoid costly fines,
- And swift claims management to minimize downtime.
Insure to Ensure Growth
Motor insurance in the Gulf isn’t just a compliance checkbox—it’s a strategic business decision. As vehicle numbers rise, so does the potential risk to your operations. Choosing the right coverage today safeguards your business continuity and reputation tomorrow.
In markets like the UAE and Kuwait, where motor insurance spending is rapidly climbing, smart companies are investing in comprehensive and fleet solutions that do more than just protect vehicles—they protect business momentum.
Ready to drive your business forward with confidence? Talk to us at DAMANA. We’ll tailor a motor insurance policy that fits your fleet, your risks, and your ambitions.
Sources:
GCC Motor Insurance Market Size and Growth
Statista, Motor Vehicle Insurance – GCC
https://www.statista.com/outlook/fmo/insurances/non-life-insurances/motor-vehicle-insurance/gcc
UAE Market Size and Insurance Penetration
Atlas Magazine, The UAE Insurance Market
https://www.atlas-mag.net/en/article/the-uae-insurance-market
Dubai April 2024 Flood Impact
The National News, UAE Storms: Dubai Flood Damage Could Exceed Dh10.8bn
https://www.thenationalnews.com/uae/2024/04/23/uae-storms-dubai-flood-damage/
Oman Cyclone Shaheen Economic Impact
Reuters, Oman Faces Aftermath of Cyclone Shaheen
https://www.reuters.com/world/middle-east/oman-begins-clean-up-after-cyclone-shaheen-2021-10-04/
Kuwait Market Growth and Penetration
Atlas Magazine, GCC Insurance Market 2022 Turnover
https://www.atlas-mag.net/en/category/regions-geographiques/moyen-orient/gcc-insurance-market-2022-turnover
Kuwait CAGR Projections
Gulf Business, GCC Insurance Market to Grow 4.3% to $36.1bn in 2024
https://www.gulfbusiness.com/gcc-insurance-market-grow-4-3-36-1bn-2024-report/
KPMG, Insurance Overview – Bahrain 2025
https://assets.kpmg.com/content/dam/kpmg/sa/pdf/2025/insurance-overview-2025.pdf
Argaam, Saudi insurance spending per capita up 30% to SAR 2,034 in 2023.
https://www.argaam.com/en/article/articledetail/id/1764025
GlobalData, Saudi Arabia General Insurance Market Size and Trends by Line of Business, Distribution Channel, Competitive Landscape and Forecast to 2027.
https://www.globaldata.com/store/report/saudi-arabia-general-insurance-market-analysis
