Despite a small population covering an area of only 6.8 square kilometres, the Gibraltarian insurance industry valued high in 2013. The primary reason for this is the ‘European Single Market’ for insurance. By virtue of being a dependent territory of the UK, Gibraltar is a part of the EU with exception only from the common customs tariff, the Common Agricultural Policy and VAT rules. Following the introduction of Income Tax Act 2010, Gibraltar was no longer exempt and introduced a 10% corporate tax for all companies. This has re-positioned the image of Gibraltar from an offshore finance centre to an onshore EU finance centre.
The industry continues to flourish despite the global economic crisis and subsequent European debt crisis. The Gibraltarian insurance industry grew by 12.3% in 2012 with gross written premiums totalling GBP3.6 billion (US$5.8 billion). The industry comprised six life, 42 non-life and 16 captive insurers in 2011.
Stable growth of automotive market
Gibraltar accounts for 10% of the UK motor insurance category, a larger share than Lloyd’s of London, traditionally a key insurer in that area. The steady growth of the UK’s automotive market propelled the growth of Gibraltarian motor insurance category during the review period and the trend is expected to continue over the forecast period.
With the UK’s economy and Gibraltar’s per capita annual disposable income expected to improve over the forecast period, growth is anticipated in the motor insurance category at a projected CAGR of 14.1%.