Kenya, Nigeria, Morocco Africa’s fastest growing reinsurance markets, study
Kenya, Nigeria and Morocco are the fastest growing reinsurance markets in Africa, driven by the size and diversity of their economies, a young and growing population and advanced regulatory regimes, Dr. Schanz, Alms & Company said in its yearly survey “Africa Reinsurance Pulse 2016.”
The introduction of risk based capital regimes, such as in Kenya, Rwanda and Morocco, is generally welcomed as a measure to improve underwriting discipline and to strengthen the insurers’ capitalization, while the introduction of a legislation known as “no premium, no cover” is another step taken by African regulators to improve the liquidity and strengthen the balance sheets of insurers and reinsurers alike, the survey noted.
African life insurance premiums totaled $ 43.7 billion in 2015, more than twice the size of the non-life insurance market, $ 20.4 billion or about two thirds of the market’s total premium volume.
The top 5 life insurance markets of the region are South Africa $ 37.5 billion, with a dominating share of 86%, followed by Morocco, $ 1.1 billion, Egypt $ 1.0 billion, Kenya $ 0.7 billion and Namibia $ 0.6 billion, the source added.
In 2015, African non-life premiums stood at $ 20.4 billion, representing about 1% of global non-life premiums. The five largest markets South Africa, Morocco, Algeria, Kenya and Egypt account for 68 per cent of the total. In non-life insurance, South Africa’s market share, at 41per cent, is less dominant than in the life space.
Morocco is the continent’s third fastest growing reinsurance market, according to interviewees. With primary insurance premiums of $ 3.1 billion in 2015 and an insurance penetration slightly above Kenya’s, it is Africa’s second largest insurance market after South Africa, the survey pointed out.
While the neighbouring countries Libya, Tunisia and Egypt suffer from political instability, Morocco is perceived “as a stable, reliable, well-regulated and technically advanced market,” the source said, adding that the government’s efforts to further open its reinsurance sector to the international market is followed with interest.
“Similarly, the set-up of Casablanca Finance City as a financial hub geared towards West-Africa is also regarded positively,” according to the same source. Since its foundation in 2008, Dr. Schanz, Alms & Company has built a track record as an expert research, strategy and communication consultancy for international financial services institutions.
The firm supports its clients in researching and analysing their business environment, developing and implementing a distinct strategic profile and effectively communicating with their key stakeholders.