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Israel Insurance Report Q1 2008Product Type: Market Research ReportPublished by: Business Monitor International Published: February 2008 Product Code: R302-2395 Description As a moderately high-income country with a sophisticated financial services sector and a favourableregulatory regime that is presided over by the Ministry of Finance, Israel should be an attractive marketfor the world’s insurers. Recent growth has been steady, if not spectacular. There are no legal barriers toparticipation by foreign insurers: indeed, the local subsidiary of Italy’s Generali is one of the five largestplayers in both the non-life and the life segments. Israel’s Insurance Business Environment Rating (IBER)- which is a new feature of this report - is high, relative to most other countries whose insurance sectorsare covered by BMI and, in particular, relative to other countries in the Middle East.However, the overall picture is unexciting. In the non-life segment, most of the growth has been in healthinsurance and personal liability insurance. Elsewhere in the segment, premiums have been stagnant. Aftera long wave of mergers and acquisitions, both the non-life and the life segments are dominated by fivelocally listed composite insurers. Some - such as Clal Insurance Pension & Finance Group, whichrecently bought the USA’s Guard Financial - have expanded by buying niche insurers overseas. Ingeneral, though, the five leaders - Clal, Harel, Phoenix Insurance Company, Menorah Mivtachim andMigdal Insurance and Finance Holdings (the Generali subsidiary) - have little room to expand withinIsrael. Competitive conditions have been brutal. Through 2007 growth in gross written premiums - of 9-10% inboth the non-life and the life segments - has not been accompanied by anything like a similar growth inoperating profit. In the first three quarters of 2007, each of the five leading insurers suffered a fall inoperating profit from non-life and/or life insurance operations. AIG is the only international insurer otherthan Generali to participate in the Israeli insurance sector. It would be surprising if any other majorsought to enter the market. Table of Contents
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