Islamic Protection and Savings Insurance in Saudi Arabia: A Review of the Current Context

HRMARS - Insurance plays an important role in economic stability, risk management, and household financial protection. Within Islamic finance, Islamic insurance has developed as a Shari’ah-compliant alternative to conventional insurance and has gradually expanded across different regions. However, despite its growth, Islamic insurance continues to represent the smallest segment within the global Islamic finance industry. Within this sector, Islamic protection and savings (P&S) insurance is particularly important because it combines financial protection with long-term savings and retirement planning. In Saudi Arabia, this segment is receiving increasing policy attention under Vision 2030 and the Financial Sector Development Program due to its potential to support household financial planning, increase savings, and contribute to long-term capital accumulation. Nevertheless, its market share remains limited compared with health and motor insurance, and individual participation continues to lag behind corporate and group business. This review paper examines the position of Islamic P&S insurance within the broader Islamic finance and Saudi insurance landscape. It discusses the current market and policy context and highlights the main structural, operational, and demand-side issues affecting the sector. The review further identifies an important gap between national financial planning ambitions and the actual uptake of Islamic P&S insurance in Saudi Arabia. It argues that Islamic P&S insurance remains underexamined as a distinct long-term financial product and that more focused research is needed to understand its role, challenges, and potential within the Saudi context.