The Sultanate of Oman has introduced mandatory natural catastrophe coverage in unified motor insurance policies, a first-of-its-kind initiative in the Gulf Cooperation Council (GCC) region and has been developed in close collaboration with Oman Re, Gallagher Re and the Oman Insurance Association.
The new framework, driven by the Financial Services Authority, comes into effect on February 19, 2026, after a one-month grace period for insurers to adjust their operations.
The plan provides policyholders with automatic protection against losses from natural disasters and weather events under third-party auto policies.
It aims to improve customer protection, clarify compensation mechanisms, introduce clear claims timelines and support long-term market sustainability through a structured and balanced risk-sharing approach.
“The program has been developed through extensive technical work, actuarial analysis and market consultation to ensure that its operations are sound, transparent and in line with international best practice,” explains Chems-Eddine Kassali, regional director for the Middle East and Africa (excluding South Africa).
Adding: “Gallagher Re is proud to support the development of this landmark program alongside Oman Re and key market stakeholders. Our responsibilities include contributing to the technical design of the program, facilitating catastrophe modeling and pricing discussions, supporting risk sharing and reinsurance structures, and working with international markets to help ensure long-term sustainability and alignment with global standards.”
The launch of the framework reflects Oman’s proactive regulatory approach and its commitment to establishing a strong protection system for individuals, businesses and the wider economy in the face of growing climate risks.
Casali said: “This milestone demonstrates the value of strong collaboration between regulators, insurers, reinsurers and advisers in delivering meaningful system-wide solutions. It also highlights how well-designed public-private partnerships can enhance policyholder protection while maintaining market stability and confidence.
“We believe this initiative provides a strong template for other markets in the Gulf and beyond looking to respond to changing climate and catastrophe risks through scalable, sustainable insurance solutions. Gallagher Re remains committed to supporting governments, regulators and (re)insurance industry partners to develop similar frameworks and build resilience through innovative risk transfer and reinsurance structures.”
“We congratulate all stakeholders involved in delivering this groundbreaking initiative and look forward to continuing our collaboration to drive a resilient insurance ecosystem across the Gulf,” he concluded.
