Introducing the Sector

The insurance sector is one of the vital pillars of the Palestinian economy, given its central role in supporting economic and social stability and promoting the principles of security and social solidarity. Through the contractual relationship between the insurer and the insured, insurance performs a dual function with social and economic dimensions. It provides protection against risks, serves as an effective tool for capital accumulation, and constitutes an essential component of the production process, thereby contributing to stimulating growth and strengthening the resilience of the national economy.

In recent years, the insurance sector in Palestine has witnessed notable development, both in terms of the expansion of the insurance portfolio and the diversity and quality of insurance services provided to the public. The sector continues to grow and adapt despite increasing challenges, affirming its position as a stable and effective contributor to the Palestinian economic system.

The insurance sector is subject to the supervision and oversight of the Palestine Capital Market Authority pursuant to the Palestine Capital Market Authority Law No. (13) of 2004 and the Insurance Law No. (20) of 2005. The Insurance Directorate undertakes these functions by monitoring the performance of insurance companies and ensuring their compliance with applicable legislation, regulations, and regulatory instructions. Despite the difficult regional and local challenges that prevailed during 2025, as well as regional tensions in neighboring countries, which negatively affected the investment climate and economic confidence, the Palestinian insurance sector demonstrated notable resilience and the ability to adapt and achieve positive results.

Total insurance premiums collected in the Palestinian market reached USD 424.7 million in 2025, compared with USD 383.5 million in 2024, representing a growth rate of 11%. Meanwhile, the value of claims paid by insurance companies to policyholders and beneficiaries increased to USD 275.5 million, compared with USD 259.9 million in the previous year, reflecting an increase of approximately 6%.

In terms of net profits, insurance companies recorded profits of USD 15.13 million in 2025, compared with USD 15.9 million in 2024, representing a decrease of 5%. This decrease is attributed to several factors, most notably the increase in the value of claims paid and fluctuations in exchange rates.

With regard to technical indicators:

• Insurance penetration, measured as total premiums to gross domestic product (GDP) at current prices, increased to 3.72% at the end of 2025, compared with 3.49% at the end of 2024. This indicates a relative recovery in the depth of the insurance market.
• Insurance density, measured as the average per capita share of the insurance portfolio, also increased to USD 77.21, compared with USD 69.74 in the previous year. This is attributed to the 11% increase in the insurance portfolio.

These indicators reflect the ability of the Palestinian insurance system to withstand challenges, respond effectively, and strike a balance between insurance protection and financial sustainability, even in a regional and local environment marked by instability and continued volatility.

* According to estimated data issued by the Palestinian Central Bureau of Statistics.