Africa Re enjoys about 20% of Nigeria’s reinsurance market share

Mr. Corneille KAREKEZI, GMD/CEO of Africa Re (in the middle), contributing to the discussions
Une attitude de M. Corneille KAREKEZI, DG d’Africa Re, pendant les débats

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Chuks Udo Okonta

African Reinsurance Corporation says it enjoys about 20 per cent of Nigeria’s reinsurance market share, while other Nigerian local reinsurers write about 15 per cent and the remaining 65 per cent are ceded to foreign reinsurers.

The firm in a statement made available to Inspenonline, stated that Nigeria, represents an important market for its operations, as the Nigerian market contributed about 13 per cent of its total turnover in 2016.

The reinsurance giant noted that it is now the leading African reinsurer on the continent, adding that of its gross turnover which exceeded US$ 642 million in 2016, only 9.5 per cent of this income is from mandatory cessions (in 41 member countries) of give per cent on treaty business, the bulk coming from North Africa. This attests to the fact that the Corporation’s income is obtained on a voluntary, competitive and value-for-money basis, it said.

“In Nigeria, the biggest market in the West African region, Africa Re enjoys about 20 per cent of the reinsurance market share. Other Nigerian local reinsurers write about 15 per cent market share, while foreign reinsurers have on the average about 65 per cent market share. The predominance of foreign reinsurers, mostly European, in the Nigerian reinsurance market has to do with the total low underwriting capacity (and shareholders’ funds) compared to the size of total risk exposures.

“Standing with Nigerian insurers, the Corporation has developed diverse partnerships to support the market development, for example in the mitigation of the forex risk. Unlike the foreign reinsurers, Africa Re accepts payment of reinsurance premiums in Nigerian bank accounts and in the national currency (Naira),” the reinsurer said.

It maintained that as efforts to support Nigerian economy, it has also invested over US$ 90 million in various Nigerian companies and indirectly created over 570 jobs, stressing that besides its involvement in the development of the insurance industry through in-house and market insurance trainings, it is also working with the National Insurance Commission (NAICOM) to enhance public awareness of insurance products in order to boost insurance penetration in the country.

“Through its Corporate Social Responsibility (CSR) Trust Fund, Africa Re’s shareholders have sponsored in the last three years up to US$ 1,252,000 in various CSR initiatives.

“Over the years, Africa Re has been involved in capacity building in the African insurance industry with the view of developing the market. In 2015, it invested US$ 380,000 to train over 1300 insurance professionals in over 100 companies. The Corporation has also instituted performance awards aimed at enhancing corporate governance, innovation and operational best standards for the insurance industry from which many African insurance professionals have benefited tremendously.

“Admittedly, the Corporation’s enviable financial and operational success has enabled it to take on certain obligations to the benefit of its various stakeholders including the insurance industry, shareholders, member States and even the communities in which it operates. These obligations have been discharged most credibly and faithfully in line with the ideals of the Corporation’s developmental mission,” it stated.

The firm noted that in the past 41 years, it has been carrying on the business of reinsurance in the African continent, adding that this journey of dedicated service to the insurance industry has contributed in no small manner to the economic development of the continent.

The statement stated that the main purpose for the establishment of the Corporation in 1976, was to prevent capital flight from the African continent, a practice which was massively prevalent in the 1960s & 1970s and which still persists nowadays, though in a reduced way.

The firm said its mission includes the development of the insurance and reinsurance industry in Africa, promoting the growth of underwriting and retention capacities across the continent, and supporting African economic development, adding that the pursuit of this mission has been the sole focus of the Board of Directors, Management and staff of the Corporation over the years.

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