With reinsurance premiums across the continent predicted to expand in line with or faster than GDP growth, stable and increasing reinsurance rates may be on the cards.
South Africa still dominates the market, accounting for 80% of Africa’s entire life reinsurance market in 2017, and amassing $3.3bn worth of premium volumes in the non-life reinsurance space. However, reinsurance is proving indispensable on the continent, with demand growing in other African countries. In the non-life space, South Africa, Kenya, Egypt, Nigeria and Morocco have a combined market share of 75% in Africa.
Demand for crop insurance is like to increase. “This is so important for the financial security of Africa’s farming community, but it is not nearly as developed because governments don’t subsidise the premiums,” says Steve Murphy, head of the reinsurance division of Santam. “Reinsurers are the ultimate place where the consequences of, for instance, poor climate change management are paid.”
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