Africa: Reinsurance premiums soon to reach $64bn
The industry is expected to experience strong growth by 2020.The reinsurance market in Africa is expected to experience strong growth, driven by an expansion of its primary markets, with insurance premiums reaching $64 billion by 2020, according to the African Reinsurance pulse survey, seen by Ghanaweb.
Conducted by Dr. Schanz, Alms & Company and facilitated by Africa Insurance Organization, Africa Re, Swiss Re, Casablanca Finance City and Qatar Financial Center, the study shows that the market’s growth will be based on abundance of natural resources, the need for infrastructural investment, the emergence of an expanding middle class and a young and growing population.
The continent's low insurance penetration, standing at 2.9 per cent against the global average of 6.2 per cent, also indicates the growth potential of the industry.
However, political instability is the biggest threat to the reinsurance market and can strongly affect growth expectations.
The lack of local expertise, reliable data and statistics is also regarded as a weakness.