Leading life insurance company Alico, which quietly entered the UAE's general insurance market, is preparing to do so in Oman as well. Alico has entered general insurance in the name of its parent, American International Group (AIG) General Insurance. It recently entered the Indian life insurance market through a tie-up with the Tata group.

Rabih Abdul Khalek, Alico's general manager - Gulf, said the company currently holds almost 45 per cent of the local market in insurance premiums for life, personal, accident and medical insurance and pensions.

General insurance "gives us a great opportunity to better provide our clients with comprehensive, tailormade insurance solutions to satisfy their needs". According to market estimates, the size of the general insurance market in terms of premiums in the UAE is Dh1.2 billion, and life insurance is about one fourth the size.

The general insurance market in the Gulf is characterised by fierce competition on one side and high automotive claims on the other. But the industry believes there is always room for more good insurance companies, since smaller insurers will eventually fail or consolidate.

Asked whether the entry of Life Insurance Corp (LIC) of India into the UAE market will affect prospects, Khalek said, "Competition is healthy and depicts a good sign of strong market potential for growth. The presence of more life insurers can only spread awareness and benefit the entire sector."

The LIC chief predicted earlier that his company would sell over 10,000 policies in its first year of its operations in the UAE. Meanwhile, the collapse of Onic Insurance in Oman has raised eyebrows in the Gulf insurance market, especially in general insurance. Despite being the largest insurer in the sultanate, holding about half of the market, Onic Insurance is headed for closure in Oman.